European Union: UK Jobs

Lord Pearson of Rannoch: asked Her Majesty's Government:
	What is the basis for their statement that 3.5 million jobs depend on the United Kingdom's membership of the European Union.

Lord McIntosh of Haringey: My Lords, the European Union is Britain's foremost trading partner, accounting for more than half of our export trade. The estimate that over 3 million UK jobs are linked to our trade with the European Union is based on analysis of the employment income generated directly and indirectly in the production of exports to the European Union.

Lord Pearson of Rannoch: My Lords, linking trade and jobs to membership of the European Union is not the same as implying that if we left it those jobs would be lost. Is the noble Lord aware that recently the National Institute of Economic and Social Research, the Institute of Economic Affairs and the US International Trade Commission in Washington have all published detailed analyses which show that if we were to leave the European Union the effect on our economy and jobs would be negligible? Is the noble Lord further aware that in reaching this conclusion the IEA and the NIESR assumed that tariff barriers of between 6 and 9 per cent would be erected against us if we left? As the Economist opined as recently as 20th October, does the noble Lord not agree that if we left the EU with a free trade agreement—which we could certainly have—the benefits of leaving could be enormous?

Lord McIntosh of Haringey: My Lords, I am grateful to the noble Lord for his fact-filled question. However, what I said was that these jobs are linked to our trade with the European Union. I did not say that if we were not members we would have no trade with the European Union. I am interested to hear what the noble Lord says about two entirely objective institutes and one which, I think that he will agree, is normally thought to have a particular point of view.

Lord Jones: My Lords, can my noble friend say how many of the jobs mentioned in the Question are manufacturing jobs? Can he further say what the Government are doing to promote and to defend the manufacturing base in Britain? Does he know of the anxiety that many of us feel with regard to the long-term future of the British steel industry—the seedcorn of British manufacturing?

Lord McIntosh of Haringey: My Lords, it is not possible from input and output statistics to calculate what proportion of those jobs are manufacturing jobs, but, as my noble friend knows, we are very concerned about the manufacturing industry in this country. We are determined to protect it as far as is possible. Our membership of the European Union is no deterrent to that.

Lord Waddington: My Lords, does the noble Lord agree that since 1990 the United States of America has increased its exports to Europe faster than we have increased ours? Does that not tend to show that perhaps what matters most is having a lean and strong economy rather than escaping all tariffs?

Lord McIntosh of Haringey: My Lords, I did not use the phrase "escaping all tariffs". I agree that it is enormously important to have a lean and strong economy. That has been the very successful thrust of the Chancellor's policies over the past four-and-a-half years.

Lord Oakeshott of Seagrove Bay: My Lords, does the Minister agree that nothing could be more obvious folly at a time when unemployment has already clearly started to rise than to put at risk the jobs of those who are involved in trading with our most important partners? Does he therefore accept that we on these Benches have no sympathy with the Question first asked. Does he further accept that it would help if the trumpet stopped blowing with an uncertain sound between the Chancellor of the Exchequer and the Prime Minister and we started making the case for British membership of the euro?

Lord McIntosh of Haringey: My Lords, I am happy to have the support of the noble Lord, Lord Oakeshott, for our membership of the European Union. That support is widely held, not just among the Liberal Democratic Party and the Labour Party. I completely deny that the trumpet is sounding with an uncertain sound. The Chancellor and the Prime Minister have both said—it is true—that there is not an iota of difference between them on these matters.

Lord Monson: My Lords, does the Minister agree that in February of this year two distinguished European Commissioners, Mr Neil Kinnock and Herr Bolkestein, assured the "Today" programme that there would be no danger of reprisals if Britain were to leave the European Union?

Lord McIntosh of Haringey: My Lords, the Question is not about leaving the European Union. No one has suggested, as far as I know, that there would be any particular reprisal. The issue which is raised by the Question is of the economic benefit to this country from its membership of the European Union. That is what I have been answering questions about.

Lord Tomlinson: My Lords, does my noble friend recall that the noble Lord, Lord Pearson of Rannoch, had so much confidence in his rather eccentric view of the European Union that when it was challenged in the last Session of Parliament by an amendment tabled by the noble Lord, Lord Plumb, he sought to withdraw his Bill rather than show confidence in putting it to a vote?

Lord McIntosh of Haringey: My Lords, I do not think that it is appropriate for me to intervene on matters between private Members of the House.

Lord Renton: My Lords, are not the Government thrilled that this trade has produced 3.5 million jobs without our joining the euro?

Lord McIntosh of Haringey: My Lords, I do not think I understand the noble Lord's question. In due course, if the conditions are right and we join the euro, I do not doubt that savings will be made which, in turn, will result in increased employment in this country.

Lord Dubs: My Lords, does my noble friend agree that, when Europe has enlarged following the accession of 10 or more countries, we shall see increased opportunities for British business and industry and an increase in the number of British jobs? Does he further agree that Europe is a positive force as regards providing jobs and improved employment prospects for our people?

Lord McIntosh of Haringey: My Lords, it is self-evident from the point of view of both economics and mathematics that if a market is increased from 375 million people to over 500 million people, substantial economic advantages will be made available.

Lord Saatchi: My Lords, why should anyone who really cares about unemployment want to merge their economy with countries where unemployment is twice as high?

Lord McIntosh of Haringey: My Lords, the advantages that we gain from links with other countries are, as I have said, self-evident. We would not be importing unemployment; rather, we would be contributing to the greater good of the greater number, to our advantage.

Biological Weapons: Global Security

Lord Judd: asked Her Majesty's Government:
	What action they are taking towards the establishment of a global bio-security order.

Baroness Symons of Vernham Dean: My Lords, Her Majesty's Government believe that the best way to achieve global security on biological weapons is to press for the universal adoption of the Biological Weapons Convention. We welcome proposals that have been made for practical and effective measures to meet the biological weapons threat. We hope that those can be agreed at the 5th Review Conference of the Biological Weapons Convention, which is due to take place in Geneva from 19th November to 7th December.

Lord Judd: My Lords, I thank my noble friend for that reply. Does she agree that recent events in the United States have underlined the indispensable need for adequate control and accountability arrangements as regards potential sources of supply? Does she further agree that, for any international regime to be effective, enforcement and inspection in all countries—without exception—is vital? If the United States still finds it impossible to endorse the protocol on which the UK Government have carried out so much work, can my noble friend tell the House what will be the position of the UK Government as regards the proposals being put forward by the United States?

Baroness Symons of Vernham Dean: My Lords, when noble Lords last discussed the matter around two weeks ago, I believe that I told the House that the United States did find it impossible to endorse the protocol but had put forward suggestions as regards strengthening the convention itself. We welcome those suggestions. They address a number of important issues: improving international disease control; enacting international criminal legislation; along with a number of other measures which will be extremely useful. For our part, we would welcome any proposals that provide practical and effective measures to meet the biological weapons threat. As regards inspections and other issues which have given cause for concern in the United States, of course those will be matters for discussion and negotiation during what will be a fairly lengthy conference period.

Lord Redesdale: My Lords, does the Minister agree that, if the United States does not sign up to the Biological Weapons Convention, the convention will then be seen as fatally flawed? Given the implications of the recent anthrax attacks, which it is suspected may have emanated from terrorist acts committed within the United States itself, the global perspective of the threat should give the United States cause to reconsider its position. Are the Government pressing the United States to do so?

Baroness Symons of Vernham Dean: My Lords, towards the end of July this year, the United Kingdom Government, in concert with our colleagues in the European Union, expressed to the United States our disappointment over its decision not to endorse the protocol. The noble Lord is quite right to say that United States participation in the convention—here I draw a distinction between the convention and the protocol—is enormously important. The United States pharmaceutical industry produces around 40 per cent of the world's supply of pharmaceuticals. Without the participation of the United States, of course there would be no real incentive to press other countries that we very much want to see sign the original convention. I shall mention Russia, China, India, Pakistan and Iran as only a few examples, although they are all extremely important countries. As I have said, it will be far more difficult to persuade other countries to adopt the convention. Therefore we must address not only the issue of the United States itself, but also the issue of the United States and its ability to act as an incentive to other countries.

Lord Howell of Guildford: My Lords, the Biological Weapons Convention is vitally important, but the Question tabled by the noble Lord, Lord Judd, raised the issue of global bio-security. Global bio-security is a concern of the World Health Organisation, which has put forward a range of proposals to establish a balanced approach to antimicrobial agents as regards whether they should be used to aid animal health. If they are overused, they may pose a risk of infecting food. Can the Minister tell the House the Government's response to the WHO proposals put forward in relation to global bio-security, which I believe is what the Question seeks to address?

Baroness Symons of Vernham Dean: My Lords, I had understood that the main concern of my noble friend related to the threat of biological weapons. I believe that that is the thrust of both his Question and his supplementary question. As regards the proposals being put forward by the WHO, of course the noble Lord is quite right to point out that that organisation plays an important role as regards the wider issues of bio-security. Perhaps I may consult with my colleagues in the Department of Health and write a detailed response to the point that the noble Lord has raised.

Lord Tanlaw: My Lords, can the Minister include in her deliberations on this matter consideration of the risk of biological threat from outer space? Tonight a meeting will be held of the All-Party Astronomy and Space Environment Group. It will hear a scientific case for human space exploration. Is the Minister aware that, within the next two or three years, samples from other planets will come to the earth's surface which may contain serious biological threats? What is to be done about that?

Baroness Symons of Vernham Dean: My Lords, I agree that the wider issues of bio-security extend a great deal further than this planet. I shall do what I can to find out what is happening in other departments on the wider question raised by the noble Lord. That means obtaining a wide variety of advice from different scientific sources around government. I shall endeavour to do that before writing to the noble Lord.

Extradition of Terrorists

Baroness Blatch: asked Her Majesty's Government:
	When they will amend the Human Rights Act 1998 in order that known terrorists in the United Kingdom who are wanted by other countries may be extradited.

Lord Rooker: My Lords, the United Kingdom takes its international obligations very seriously. Fulfilling obligations towards its extradition partners does not entail any amendments whatever to the Human Rights Act 1998.

Baroness Blatch: My Lords, does the Minister agree that, where a country requests the extradition of a known terrorist from the United Kingdom, and we refuse to extradite on the basis that that country has the death penalty as part of its judicial system, it does not make sense to be more concerned about the human rights of the terrorist than about the protection of our people and the cost to our taxpayers?

Lord Rooker: My Lords, at the moment 10 people are held in extradition custody. They may or may not be sent back once the extradition process is completed. However, as I indicated yesterday, where a country has the death penalty, we will not return anyone to that country unless we receive confirmation that the death penalty will not be exercised. That is perfectly normal. It was the policy of the government of whom the noble Baroness was a Minister. It is acceptable to the United States. It is not a problem. We have not had any difficulties in that respect with countries which have sought extradition. Not many of our extradition partners still retain the death penalty. But that is the position and we do not intend to deviate from it.

Lord McNally: My Lords, does the Minister recall that during the long years of Conservative government, his party and mine campaigned for the incorporation of the European convention into British law? Its passing into law was one of the early successes of this Government. Will he confirm that he sees that Act as part of our integral civil liberties and human rights, and not as a piece of fair weather legislation to be derogated from when the waters get choppy?

Lord Rooker: My Lords, I agree with the noble Lord, Lord McNally. Even if we were prepared, after 50 years plus, to pull out completely from the European Convention on Human Rights, simply not having the Human Rights Act here would not alter the law. All it would mean is that British citizens who wished to exercise their rights would have to go through Strasbourg, and it could possibly take years and years for them to get justice. The Human Rights Act did not alter the law in this country or bring any new rights to our citizens. It enabled them to exercise, via the British courts, rights which have existed for more than 50 years.

Baroness Buscombe: My Lords, yesterday, in regard to the reluctance of the Government to resort to deportation of terrorists, the Minister said:
	"the noble Lord is asking me to derogate not only from the European Convention on Human Rights, but in fact to get out of something to which this country has been a signatory under both Governments for over 50 years".—[Official Report, 14/11/01; col. 565.]
	Will he now confirm that that statement was incorrect? Will he confirm that the European Convention on Human Rights makes no provision restricting, in any way, the right of states to deport alien nationals from their territory? Will he further confirm that, until the Soering case, decided in the court in Strasbourg in 1989, the executive—that is, the Home Secretary—had the power to deport on grounds of national security?

Lord Rooker: My Lords, I shall take advice on this matter. However, I shall stick to the words that I used yesterday in answer to the noble Lord, Lord Dixon-Smith. I am not aware—again I shall take advice—that we have knowingly extradited anyone in the past without the derogation that they would not receive the death penalty. The Home Secretary has made the Government's policy absolutely clear: he will not allow anyone to be deported who he knows will face torture or the death penalty. That is not to say that we shall not extradite to a country which retains those rights, provided we receive an assurance that the penalty will not be exercised.
	As one of the answers I gave yesterday has been quoted by the noble Baroness, I should tell her that, at col. 566 of Hansard, I gave an answer in error to the noble Viscount, Lord Waverley. The list of proscribed organisations has not changed since 11th September. I was in error. I was thinking of the Treasury list of organisations which have had their assets frozen. The list remains at 35 organisations.

Lord Stoddart of Swindon: My Lords, what would be the position if Osama bin Laden came to this country as an illegal immigrant, was subsequently arrested and the United States demanded his extradition?

Lord Rooker: My Lords, the case would go through due process because we have an extradition treaty with the United States. Provided that all the legal technicalities involved with the warrant from America are completed to the satisfaction of the British courts, and provided that the United States does what it has done in every other case—that is, gives an assurance that the person concerned would face justice but would not be executed—that person could be extradited.

Lord Rotherwick: My Lords, could not the law be wrong where a terrorist, who may have killed women and children in another country, can gain entry to our country under asylum laws, live in the sanctuary of our country and be paid for by taxpayers?

Lord Rooker: My Lords, if the person is a known terrorist he cannot claim asylum. The asylum convention, under 1F, does not allow known terrorists to claim asylum. If a claim for asylum is found to be false—if the person lied when he came in and we did not have the full facts and information—it can be dealt with subsequently and we can take action in that respect. If the person is in this country and under the jurisdiction of the British courts, irrespective of whatever heinous crimes he may be guilty of, we will not extradite him knowing that he will face execution or torture. That is not to say that he will not be extradited, but we will not take that action. We have to live at a higher level than the terrorist vermin. That is our policy and we shall not change it.

Lord Davies of Coity: My Lords, being in complete sympathy with our law on capital punishment, can my noble friend tell the House the extent to which terrorists abroad are committing atrocities and using this country as a haven in the knowledge that they will not be extradited to countries which have capital punishment?

Lord Rooker: My Lords, if I had the information to answer my noble friend we would probably have a few more people locked up. Ten cases are currently going through the extradition process as a result of requests from the USA, France, Spain, Italy and Algeria. I do not know about the policy decisions of our partners, but the policy decisions of this country are absolutely clear. One of the reasons for the proposals in the Anti-terroism Crime and Security Bill, which will come before the House shortly, is to deal with those who abuse the rules and policies of this country, so they will not be free to roam this country.

Lord Pearson of Rannoch: My Lords, is it not a bit much that we cannot extradite Mr Osama bin Laden to the United States of America because he might face the death penalty, whereas British subjects now face the prospect of being arrested, on the say-so of a Belgian magistrate, to stand trial in Brussels, without habeas corpus and without trial by jury? Have we not got things a bit muddled up?

Lord Rooker: My Lords, there is no death penalty in Belgium; there is no torture in Belgium. The death penalty remains in some states of the United States of America. It is like comparing chalk and cheese.

Afghanistan: Humanitarian Aid

Baroness Whitaker: asked Her Majesty's Government:
	How humanitarian aid to Afghanistan can be increased now that Mazar-i Sharif and Kabul have fallen.

Baroness Amos: My Lords, we hope that the UN and the ICRC will be able to improve the delivery of food, healthcare and other assistance to 2 million vulnerable people in the northern region of Afghanistan, and that some of the internally displaced will be able to return home before the winter gets worse. Such progress is dependent on improved security.

Baroness Whitaker: My Lords, I thank my noble friend for that positive Answer. Is she aware that there have been reports of looting from World Food Programme, UN and voluntary sector offices in both Mazar-i Sharif and Kabul, and that UNICEF now has convoys coming in with urgent medical supplies which will be under threat? What steps can the Government take, together with other players, to safeguard these essential supplies, so desperately needed by the people there?

Baroness Amos: My Lords, I understand that there was a report of 10 trucks being seized by Northern Alliance troops. Eight of them have been found; the supplies are intact and the drivers are safe. I also understand that UNICEF met with military commanders yesterday, although I am unable to report the outcome of the meeting. Plans are being made for the international staff of the UN, the Red Cross and other NGOs to return to Afghanistan and thus improve services to vulnerable people there.

Baroness Rawlings: My Lords, we on these Benches are delighted to hear the good news today that the humanitarian aid workers are free. Following a successful meeting between my honourable friend Caroline Spelman and the Secretary of State, Clare Short, will the Government make certain that humanitarian aid is delivered to the most vulnerable people? These are mainly widows in the war zones who have lost their men in battle.

Baroness Amos: My Lords, I agree with the sentiment expressed by the noble Baroness. We are delighted to learn that not only have the eight foreign workers been freed but also their Afghan counterparts. I can assure the noble Baroness that our priority is to ensure that the most vulnerable people in Afghanistan receive assistance.

Lord Phillips of Sudbury: My Lords, given that the military activity is continuing—although, mercifully, it has had great success lately—and given that there are 10 million unexploded mines and bomblets in Afghanistan and that four children a day are being blown up by them, will the Government consider taking the initiative with the coalition at least to prevent any further cluster bombs being dropped, as 10 to 15 per cent of the bomblets do not explode on landing?

Baroness Amos: My Lords, the situation that we have now reached indicates that it was not necessary to stop the air campaign to allow humanitarian aid into Afghanistan. Although the situation is difficult, supplies have actually increased since 11th September.
	We are concerned about the situation as regards mines. The Department for International Development has been assisting with mine clearance. We have also produced, with our international partners, a 100-day recovery programme, looking at a whole range of issues that need to be tackled in Afghanistan. That includes what is happening at the UN in regard to the political situation and other areas that need to be addressed to ensure that humanitarian assistance gets through.

Baroness Uddin: My Lords, what is being done to ensure that medical as well as food supplies are getting through, bearing in mind particularly the needs of women and vulnerable children? Will my noble friend also tell the House what is being done to ensure that some kind of immunisation programme is in place, particularly for young children?

Baroness Amos: My Lords, a number of UN agencies are looking at the breadth of the situation in Afghanistan. It is still early days in the sense of opening up access. However, I am aware, for example, that UNICEF is taking in much-needed medical supplies. As my noble friend rightly said, that will help the situation particularly in regard to women and young children.

Earl Russell: My Lords, further to the question about widows from the noble Baroness, Lady Rawlings, when Her Majesty's Government find anyone who might be regarded as being in power in Afghanistan, will they impress upon them the importance of allowing women to work should they choose to do so?

Baroness Amos: My Lords, we, with our European Union partners, have made it absolutely clear that the situation that existed under the Taliban regime whereby women were not allowed to work was unacceptable. We shall continue to maintain that position.

Lord Judd: My Lords, my noble friend referred to the return of NGOs to their role in Afghanistan. Will she assure the House that the co-ordination between NGO work and government work is now all that it should be?

Baroness Amos: My Lords, my noble friend has asked about co-ordination many times. I have assured him that work is taking place not only between government and NGOs, but also across government—in terms of development, military considerations, and the examination of diplomatic and political issues—to ensure proper co-ordination.

WTO: Ministerial Conference

Baroness Symons of Vernham Dean: My Lords, with the leave of the House, I shall now repeat a Statement made by my right honourable friend the Secretary of State for Trade and Industry in another place. The Statement is as follows:
	"With permission, Mr Speaker, I should like to make a Statement on the Fourth Ministerial Conference of the World Trade Organisation in Doha, which concluded yesterday. I was joined in the delegation by my right honourable friends the Secretary of State for International Development, the Minister for the Environment and my noble friend the Minister for Trade.
	"I am delighted to report a successful outcome—the Doha Development Agenda—which combines the launch of a broad new round of trade negotiations with a package of measures focused specifically on the needs of developing countries. At the same time, we have welcomed two new important new members—China and Chinese Taipei—into the WTO. These are landmark achievements, the economic and political importance of which cannot be overstated.
	"Launching a new world trade round has always been a key priority for the United Kingdom Government and our European Union partners—an outcome that we were even more determined to achieve following the atrocities of 11th September.
	"In the last few days we have seen significant progress in the war on terrorism in Afghanistan. At the same time, nations have come together in Doha to agree a major step forward in the war on poverty, demonstrating that the nations of the world are determined to strengthen security by sharing prosperity.
	"By stimulating economic growth, a development-focused trade round offers the best opportunity to people in developing countries to escape from poverty. And with the downturn in the world economy, this historic deal gives a badly needed boost to economic confidence.
	"The package we have agreed brings real benefits to developing countries—benefits for which my right honourable friend the Secretary of State for International Development has long been pressing. We have opened greater access to the medicines that developing countries need to deal with HIV/AIDS and other serious health crises, through clarification of the existing rules. We have ensured that the European Union will continue to give preferential treatment to imports from Africa, Caribbean and Pacific countries—an issue of enormous concern to over 50 of our WTO colleagues, including some of the poorest.
	"We have agreed on steps—both immediately and in the next year—which address developing countries' concerns over the implementation of previous WTO agreements. We reaffirmed the importance of building developing countries' capacity to participate in the global trading system, and emphasised the need for capacity building to be an integral part of the new negotiations.
	"A new round opens the prospect of increased trade in agriculture, other goods and services—trade which is the most secure path to economic progress for developing countries. Halving trade protection in both developing and the developed countries would boost the wealth of developing countries by around 150 billion dollars a year—about three times what they receive each year in development aid. And for the least developed countries we have agreed the objective of duty and quota-free access for their products—extending the principle of the European Union's Everything But Arms agreement to other WTO members.
	"For developing and developed countries alike, the Doha agreement will provide a significant new push in a number of areas of great importance to the United Kingdom. The new trade round will open up trade in agriculture and give a real boost to the reform of the common agricultural policy. In particular, we have agreed to negotiate on reductions of export subsidies with a view to phasing them out. This adds to the pressure which the European Union already faces from the prospect of enlargement and strengthens our hand in moving ahead with CAP reform—a longstanding United Kingdom objective, now within our sights.
	"We reaffirmed the importance of sustainable development and for the first time we agreed to negotiate within the WTO on environmental issues, in particular the relationship between multilateral environmental agreements and WTO rules. This was a key objective for the United Kingdom and our EU colleagues. We agreed important first steps towards negotiations to help investment flow more freely between countries and to tackle cartels and other anti-competitive business practices. We reaffirmed the importance of internationally recognised core labour standards. The ILO leads on that issue, but it is essential that the WTO contributes to the work of the ILO on the social dimensions of globalisation.
	"We also agreed negotiations in a number of other important areas including market access and industrial tariffs, transparency of government procurement and trade facilitation aimed at cutting customs procedures red tape. We took decisions on the next stages of the ongoing negotiations on services and continuing work on e-commerce.
	"These new trade negotiations will be good for British business and good for British consumers. As the world's fifth largest trader, the potential benefits of further trade liberalisation are considerable. Halving trade protection around the world would boost the average income of every household in Britain by nearly £500 a year.
	"It is not just the United Kingdom which benefits. The package we have just agreed represents a major step forward for world trade that will bring great gains for people all over the world. It also represents a major step forward in building the global architecture we need for a secure, prosperous world. What was most striking about discussions in Doha was the growing confidence of developing countries, with African, Latin American and the poorest countries increasingly working together effectively and a growing trust between developing and developed countries.
	"The Doha Development Agenda has involved great willingness from all countries to work together flexibly and constructively to overcome considerable differences in certain key areas. The result is a tribute to all those involved. All of us in Europe owe a particular debt of gratitude to the skill of the EU's chief negotiator, Trade Commissioner Pascal Lamy.
	"I want to pay tribute in particular to the state of Qatar for hosting the conference and for its excellent organisation and chairmanship. Conference Chairman Kamal and the seven facilitators worked tirelessly and effectively to ensure that all member countries, whether large or small, developed or developing, had the opportunity to be fully involved and that proceedings were as transparent as possible. I also want to pay tribute to the World Trade Organisation's director general, Mike Moore, and to the WTO's General Council chairman, Stuart Harbinson. Their skill and diplomacy have helped us to get this round on the road.
	"I want to thank the tremendous team of civil servants from six government departments who worked tirelessly to help secure our objectives. I should also like to highlight the role of three delegation members, Digby Jones of the CBI, Ed Sweeney of the TUC and Penny Fowler of the UK NGO trade network. Their contribution has been invaluable.
	"The United Kingdom and the European Union have long sought the launch of a new trade round. We went to Doha seeking a round which would open up free, fair and sustainable trade. I am delighted today to present exactly that result to the House. But this is just the beginning of the process. Now we have to translate the agenda we have agreed into real results. Together with over 140 WTO members, we have taken the first vital steps. We shall work now to complete the journey".
	My Lords, that completes the Statement.

Baroness Miller of Hendon: My Lords, I thank the Minister for repeating the Statement made in the other place earlier today by her right honourable friend the Secretary of State for Trade and Industry. I also thank her for arranging for a copy of the Statement to be given to me much earlier than is usual in these circumstances.
	We on this side of the House certainly welcome the Statement; it would be churlish of me to say anything other than that. However, I am sure the Minister agrees that after the failure at Seattle it would have been an absolute disaster for every country in the WTO if the partcipants had not reached agreement in Doha. However, does the Minister accept that there is often a great difference between verbal and written agreements and their implementation and that in the end it will be on the implementation that Doha will be judged?
	Does the Minister agree that probably the main difficulty will be in the area of agriculture and the common agricultural policy? Despite the words in the agreement, are not earlier statements of EU Trade Commissioner Pascal Lamy defending farm subsidies, and, indeed, the French delegation's resistance to phasing them out, a worrying indication that it may not all be plain sailing and, indeed, there may be many of the old battles still to come? Can the Minister therefore restate the Government's absolute commitment to the aim stated in the declaration which is, first, to reduce and then to phase out all forms of export subsidies? Can the Minister say whether there is any evidence to support reports that the French signed the declaration only after receiving an assurance that it did not prejudge the outcome of the farm trade talks? Does the Minister agree that the rumour of protectionism already raising its ugly head is deeply worrying and that much work in this area is needed to ensure the implementation that we all want?
	We welcome the agreement on TRIPS but accept that there will have to be measures to reassure the pharmaceutical industry that production under licence in developing countries will not lead to back-door imports. The Minister may be able to enlighten us on what steps will be taken to prevent that.
	Many noble Lords on this side of the House, and probably on others too, will welcome the news that the preferential treatment of imports from African, Caribbean and Pacific countries is to continue. I said at the beginning of my remarks that we on this side of the House welcome the Statement and, therefore, I have restricted my comments and questions to just those few matters that might give us cause for concern.

Lord Wallace of Saltaire: My Lords, we warmly welcome this extremely important Statement and the beginning of a new trade round. Most of all we welcome the fact that at last we are tipping the balance in trade negotiations from an EU/US orientation to being much more concerned about how open trade benefits the developing world.
	We also strongly support and welcome the emphasis on environmental sustainability. That is an extremely important initiative. The test, of course, will be successful completion of the negotiations, not just successful launching. Some of us remember how much longer it took to complete the Uruguay Round than was originally intended. How long do the Government expect the current round to take and is there any agreement so far on when it is intended that it will be completed? The Statement contains a number of commitments on measures to be implemented soon. When will the significant concessions made with regard to the intellectual property of affordable medicines be introduced? Will they be introduced immediately, in two or three years' time, or is a longer time-scale anticipated?
	Will the European Union be able to decide on its negotiating position by qualified majority voting in a number of key areas? That is good evidence of the advantages to Britain of membership of the European Union and the extent to which Pascal Lamy has negotiated in British interests as well as in common European interests. It clearly shows that the use of qualified majority voting for negotiating issues such as freeing trade and agriculture—which one member state may wish to block—has clear advantages for Britain.
	We also welcome the evidence of renewed American commitment to multilateral negotiation and agreement. In passing, I wonder whether we have any evidence yet that the American acceptance of the importance of environmental sustainability in the context of Doha may extend to a reconsideration of their position on the global warming negotiations.

Baroness Symons of Vernham Dean: My Lords, I thank the noble Baroness and the noble Lord for their warm welcome of the Statement on a set of negotiations that it is genuinely important to have launched. I have no hesitation in agreeing entirely with the comments of the noble Baroness about the potential for disaster if that had not happened, particularly after Seattle. The United Kingdom delegation put forcefully to our colleagues the importance of launching this trade round.
	Reflecting the point made by the noble Lord, Lord Wallace of Saltaire, we have set an agenda rather than negotiated an agreement. It was very important to settle that agenda and to distinguish the areas for negotiation over what I think will be a two or three-year period. That also answers the noble Lord's question about the time-scale. However, one should not underestimate the difficulties of agenda-setting among what were 142 countries, now happily expanded to 144.
	The noble Baroness suggested that the most difficult part of the agenda would relate to agriculture and the common agricultural policy. I have no hesitation in saying that that will be enormously difficult. We were pleased to secure the wording on the phasing out of subsidies. We have argued for a long time on that issue, as did the Conservatives when they were in government. There is no difference between any of the parties in the House on that important point. The text that has emerged on agriculture will provide a sound basis for the substantial negotiations on further liberalisation that we want. The time frame for that meshes in very well with the Agenda 2000 mid-term review for reforming the common agricultural policy. We believe that Doha marks an important step forward on those revisions and for the United Kingdom's point of view.
	However, that will not necessarily be the most difficult point of negotiation. We will face hugely difficult negotiations on other issues mentioned in the Statement including the important points raised by the noble Lord, Lord Wallace of Saltaire, on the environment. No one should be in any doubt about the enormous trouble that we had in getting the environmental issues on the agenda. The European Union had to persuade fellow members throughout the WTO—not just the United States or the Cairns Group, but also our colleagues in developing countries—who are immensely suspicious of the issue as a different form of protectionism. We must bear those concerns in mind and be sensitive to them.
	The TRIPS agreement on intellectual property rights was an enormously problematic issue. Essentially, it relates to access for very poor countries to life-saving medicines for such scourges as HIV/AIDS, malaria, TB and a host of other very difficult illnesses that arise in such countries and to the importance of ensuring that there will be research and development for new life-saving drugs into the future. We have struck a balance on that, particularly with the wording of paragraph 4 on the declaration on the TRIPS agreement and the relationship of access to medicines and questions of public health. That was a very difficult point of negotiation that I was glad we were able to achieve.
	The noble Baroness is right about the ACP. Your Lordships have discussed the issue often in the past, particularly our major concerns for our colleagues in the Caribbean. We have long given preferential treatment in the EU to imports from the ACP countries. That strongly reflects our historic ties and those of other EU countries. The decision in Doha gives WTO approval for those preferences, including zero tariffs for most industrial goods. Without that waiver, we would be in breach of the most basic WTO principle on non-discrimination between WTO members. That has been an enormously important point for us to secure.
	The noble Lord, Lord Wallace of Saltaire, asked a further question about the TRIPS agreement. The council is tasked with clarifying by the end of 2002 how developing countries with little or no manufacturing capacity can make use of the compulsory licensing procedures under the agreement. The least developed countries have been given an extra 10 years—until 2016—before they must introduce patenting on pharmaceutical products. Again, I believe that those were very important points to have agreed.
	The noble Lord also asked about the possibility of the United States Government reconsidering their position on the Kyoto agreement. As the Americans might say in negotiating terms, that is pushing the envelope a little too far on this occasion, but it is good that they have been willing to have such environmental protection issues tabled for further discussion. We are pleased to have made that small, but not insignificant, step in the right direction.

Lord Biffen: My Lords, I appreciate that the meeting was an agenda-setting occasion, but can the Minister say whether any consideration was given to the desirability or otherwise of open trade in genetically modified agricultural products—or is that something to be left for the future?

Baroness Symons of Vernham Dean: My Lords, under the environmental issues we discussed what is termed the precautionary principle and also labelling. The labelling issues were a matter of particular concern to the European Union countries. There was also consideration of where the multilateral environmental agreements come up against the WTO. Any of those three important areas might comprehend the issues relating to GMO food. They are covered, but they will be a matter for discussions. I would not want the noble Lord to go away with the view that these will be easy matters. We know that they will be extremely difficult to negotiate. The European Union is very pleased at least to have secured their appearance on the agenda for further discussion.

Lord Monro of Langholm: My Lords, the noble Baroness mentioned reforming the CAP on a number of occasions. I declare an interest. How does she reconcile the billions of dollars of increased farming subsidies in the United States this autumn with the Government's obvious intention to reduce subsidies in this country, to the damage of the rural economy?

Baroness Symons of Vernham Dean: My Lords, that is the great strength of the WTO. We have not just agreed to a reduction in the subsidies within the European Union. This is a matter for all WTO countries, including the United States of America. This comes back to the points made by the noble Baroness, Lady Miller. The importance of this trade round cannot be overestimated. We have all signed up to it, including the United States. The Americans will similarly be obliged to negotiate on these matters.

The Earl of Sandwich: My Lords, is the noble Baroness aware that concern has been expressed at the Inter-Parliamentary Union that trade negotiations on the whole take place outside the scope of parliaments? Will the Government co-operate with a system of greater scrutiny within Parliament of what is happening in the WTO and multilateral negotiations?

Baroness Symons of Vernham Dean: My Lords, if I may say so gently to the noble Earl, your Lordships' House, through the usual channels, was offered a pre-Doha Statement by the Government. That Statement was accepted in another place and was a matter of parliamentary discussion. It was not accepted in your Lordships' House.
	I am very pleased that today we have had an opportunity to discuss these matters. However, I am afraid that, as is normal, it is for the usual channels to discuss what opportunities are provided for noble Lords to make their views known before the negotiations take place. But I am bound to say that I believe that your Lordships have been able to discuss a number of issues of great concern. Your Lordships frequently discuss, and rightly so, the issues of developing countries. This House frequently debates issues concerning agriculture and, in particular, the common agricultural policy. Therefore, although we may not have discussed this matter in a comprehensive form, bringing all the strands together, none the less I believe that your Lordships have some very wide opportunities to deal with the matters discussed at Doha.

Lord Rea: My Lords, my question does not arise from a globophobic position. In fact, if the agenda which is outlined could be enacted, I should become a strong globophile. I want to ask my noble friend about the facilities which are available to the poorer of the 144 members of the World Trade Organisation. At the ongoing discussions which continue all year round in Geneva, the better-off countries have a strong secretariat to provide backing and perhaps a team of people to present their case. However, many poorer countries often cannot afford even to send a representative, let alone to have the back-up that the better-off countries have. Therefore, the playing field is totally against those who are trying to obtain a good bargain for the developing world. Can my noble friend say whether assistance can be given by the richer nations to enable the poorer nations to present their case fairly?

Baroness Symons of Vernham Dean: My Lords, I have enormous sympathy for what my noble friend Lord Rea says. He is quite right. Many small countries which are members of the WTO do not have permanent representation in Geneva. They arrive at WTO negotiations and marvel at the number of people in the delegations of other countries, including experts—economists, lawyers, and so on.
	That is why the United Kingdom has placed so much emphasis on the importance of capacity building for the poorer countries. I have raised the subject on a number of occasions with my European colleagues during the course of European Union discussions. I am very pleased to say that, before we went to Doha, my right honourable friend the Secretary of State for International Development was able to announce a package of measures being taken in relation to capacity building. I believe that I am right in saying that in the past couple of years or so my right honourable friend has pledged more than £35 million in relation to capacity building for poorer countries.
	However, we are not stopping there. I hope that my noble friend noted the part of the Statement which referred to this matter and also the fact that other developed countries must now play a more active part in following the United Kingdom's lead on this important issue. We should actively encourage them so to do.

Lord Blackwell: My Lords, can the Minister give more detail about the procedures and timescales that might be involved in the reform of the agricultural trading subsidies that she mentioned and in the consequent reforms of the CAP? How might those timescales fit against the proposed timescale for the enlargement of the European Union and the necessary reforms of the CAP that would be involved?

Baroness Symons of Vernham Dean: My Lords, I understand the fact that your Lordships concentrate on this matter in relation to the CAP. However, I must suggest that what we have agreed in relation to agriculture is a matter of concern across all WTO members. In that respect, resumed negotiations will begin as soon as possible with our colleagues from all the countries concerned—that is, all 142 countries. The accession process for the last two countries has still to be completed, although it has been agreed in principle. Therefore, it is important to separate the two issues. There is a WTO process and, as the noble Lord's noble friend pointed out earlier—somewhat tangentially but, none the less, it is the case—it is important that we move in concert with other developed countries which also have issues concerning subsidies.
	I turn to the timescale for CAP reform. As the noble Lord may know, the chapters on agriculture with the accession countries will be opened at the beginning of next year—that is, 2002. We hope that discussions will be completed during the course of next year. That timetable is perhaps extremely ambitious. However, I believe that it is important that we in the European Union, having now secured this not insignificant step through the auspices of the WTO, take the timetable forward during the course of the next year.

Football (Disorder) (Amendment) Bill

Sex Discrimination (Election Candidates) Bill

Brought from the Commons; read a first time, and to be printed.

European Communities (Amendment) Bill

Baroness Symons of Vernham Dean: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
	Moved, That the House do now resolve itself into Committee.—(Baroness Symons of Vernham Dean.)

On Question, Motion agreed to.
	House in Committee accordingly.
	[The DEPUTY CHAIRMAN OF COMMITTEES (Lord Allenby of Megiddo) in the Chair.]
	Clause 1 [Incorporation of provisions of the Treaty of Nice]:

Lord Howell of Guildford: moved Amendment No. 1:
	Page 1, line 9, at beginning insert "Article 1 (other than paragraph 1, subsection 1, revising Article 7 of the Treaty on European Union),".

Lord Howell of Guildford: At the outset of our Committee stage, and in moving this amendment, I hope that I shall be permitted to say a few words about our approach to this and coming amendments in the Committee stage before coming specifically to the detail of this collection of amendments and the new clause which is added to them.
	We on these Benches believe that our role and proper duty is to scrutinise and, if possible, improve legislation. We believe that that applies, in particular, to this legislation because, although some days of discussion took place in Committee in another place, a number of issues were not discussed there. A number of issues have clear constitutional implications.
	We are very concerned, as are other noble Lords in other parties—they have said so very eloquently; I think in particular of the noble Baroness, Lady Williams of Crosby, the other day—that matters are not fully debated and that they arrive on the statute book without having been fully discussed. This is a very serious question and it applies nowhere more acutely, I suspect, than to the matter of European legislation and to the consequences of changes that we make or approve through our legislation; that is, in the application of changes in the treaties to our legislative structure.
	In this Bill, and in the treaties to which it relates, are issues that could change the whole face of Europe and, indeed, our own procedures inside this kingdom. We shall of course, in later amendments, discuss the whole matter of enlargement. That is certainly related to this Bill, although the nature of the relationship is a matter on which there is more than one view. We shall no doubt have healthy debates on that and on the treaty which, in the view of my noble friends on this Bench, might have made rather more progress than the present one appears to be making.
	In this and other amendments we shall argue that much of the conventional thinking about the European Union and the future shape of Europe needs to be jettisoned. We believe that that jettisoning process, which might have begun at Nice, clearly has not begun in the minds of some policy makers and their supporters.
	In discussions on future amendments we shall also want to know what "Plan B" is should the Nice treaty not make the progress that it needs to make in all the member states' legislatures and should there be difficulties with our Irish friends in rejigging the situation so that they can unblock their own position. There are other highly political aspects to the treaty's progress, such as the issue of Cyprus, which we shall doubtless examine before we are through.
	My final preliminary point is that the treaties are horribly inaccessible. They are couched in terms that are largely unintelligible, except to the expert few. Of course, this point does not relate only to the treaty; it is widely agreed that the Bill is very unsatisfactory. Only yesterday, the Financial Times described it as "feeble"; that is the kindest word that has been used about it. The experts in the Committee—there are many—may be familiar with the fact that we are dealing with two treaties, not with one, but I suspect that that is widely unknown outside. We are dealing with the Treaty on European Union (the first block of amendments relate to it) and with the treaty establishing the European Community (later amendments relate to that separate document). No wonder people long for all the treaties to be consolidated into one document, which we could discuss and amend, and which might begin to be translatable into a language that ordinary citizens could understand. That would give them some inkling of the way in which changes in the law affect their lives.
	I am grateful to Members of the Committee for letting me make those preliminary points, which relate to the amendment but also to the many other amendments that we shall discuss in coming days.
	Amendments Nos. 1 to 6 relate to Article 7 of the Treaty on European Union; they do not relate to the treaty establishing the European Community. The provisions seek to upgrade—to beef up, if I may use that phrase—the article that was previously in the treaty. This time, the concern is about the misbehaviour of an EU state. Such misbehaviour involves not so much a breach of fundamental principles but the clear risk of a serious breach of fundamental principles and rights. The proposal would allow the powers that be in the EU to intervene in a state's internal affairs on the grounds of speculation; the old article did not have that speculative element. That makes some of us uneasy. I very much want the Minister to explain the justification for making the article a more speculative weapon.
	I believe that that weapon has never been used, but it could be used on the basis of speculation and of a majority of four-fifths in the Council of Ministers. It might intercede in a situation and could be empowered to remove the voting powers of a member state that was deemed to have offended against fundamental principles.
	I make it absolutely clear that the fundamental principles, which are set out in Article 6 of the Treaty on European Union, cannot be challenged. Those admirable principles are broad—they relate to human rights, democracy, the rule of law and other matters that we regard as natural and central to our way of life. To what extent it is good that they should be embodied in EU documentation is an important question.
	We shall later debate the European Charter of Fundamental Rights, which appears not in the treaty but in a declaration that is attached to the treaty on page 78 of that document. However, I shall not now go into that or the status of the charter. The proposition that there should be a system of judgment relating to member states about whether they have conformed to broad assertions of very important and basic rights raises questions about the extent to which the rights of European citizens should be centralised. Perhaps one can distinguish between the basic rights, which are, as I said, fundamental to the way in which our free societies work, and the string of rights that we shall discuss later and which appear in the European Charter of Fundamental Rights; in many cases, they involve important social priorities, and they might be better handled at national level rather than at the supranational level or at the level of EU institutions.
	Those questions are raised in this context, and we shall later have relevant debates on the charter. They are raised by the amendment by the Treaty of Nice of the previous treaty documentation and by the introduction of the speculative element, which is about whether there is a clear risk, whatever that may be; I do not know how one defines it.
	This article has been given another name, which indicates its intended purpose or, at least, its inspiration; it has been called the Austrian article and it raises the Austrian question. What do we mean by that? We refer to the most unfortunate circumstances that emerged a year or so ago when, as a result of elections in Austria, which is a member state, politicians who had apparently appealed to the most undesirable and unhealthy political antecedents and traditions came to power. Many people who heard what was being said by Mr Haider were repelled.
	The matter does not stop there. The situation led member states of the EU and, finally and collectively, the EU as a whole, to adopt various positions. They involved sanctions, not being on speaking terms and not appearing in the same photograph with Austrian leaders. Most Members of the Committee will agree that that led to one of the most undignified and unhappy episodes in the EU's recent history. It certainly did enormous damage to the EU's reputation and dignity. None of us wishes to see that repeated.
	I suspect—the Minister may make it clear that I am wrong—that the desire to strengthen the censure provisions in Article 7 arose from the hope that there was a role for the EU in such situations and that the next time the situation arose the response would be more co-ordinated and not so undignified. It would be desirable if one could get down on paper an article and procedures about how the full force and fury of the EU could be brought to bear on an offending member state. My view and that of some of my noble friends is that that arrangement might be worse. I do not say that in a particularly challenging way; we are seeking information.
	The endeavour during the early months of 2000 to put pressure on the Austrians led to unhappy results and the general withdrawal of many assertions. That was done without in any way endorsing or approving the views of the relevant individuals in Austria. There was a strong feeling that such matters were for the nation state—for Austria. If one mobilised the great institutions of the EU and the EU itself to try to stamp out, change or push a nation into another line of behaviour, the effort would end in tears—indeed, it did.
	Those issues are raised by the article and our amendments to the Bill, which cannot change the treaty—that is done by Royal Prerogative. However, that is another debate for another time. We can change the way in which the provisions apply in our legislation.
	The article touches on another issue that we will debate on another occasion; namely, the four-fifths voting requirement, which involves a sort of qualified majority vote arrangement. At Second Reading, the Minister asked about the attitude of noble Lords on these Benches towards QMV in general. My answer—I shall give a more detailed answer later—is to quote the words of Evelyn Waugh:
	"Up to a point, Lord Copper".
	We see the case for QMV and have previously approved it but we do not see the case for the process going on and on or for going deeper into more intrusive details in areas that are much better handled locally—nearer the citizen or the grass roots—than by centralised institutions. Generally, our view—this will be reflected in many of the amendments that we shall consider—is that centralisation is to be avoided; it inevitably stretches the threads of democracy to breaking point. In particular, many aspects of the Treaty of Nice seek to replicate the nation state at a European level; that involves "upscaling" the nation state and creating a Europe whose identity—whose rules and values—involves a false perception of where the world is going and of the way in which Europe should be organised. We do not live in that age any more, although we may have in the past. The proposition that central rules and regulations that reach right into the "nooks and crannies"—to use the famous phrase of my noble friend Lord Hurd of Westwell—of national life should be endorsed and enlarged with every treaty and treaty amendment does not benefit Europe. That view is misplaced, backward-looking and inappropriate for a modern Europe. I beg to move.

Lord Bruce of Donington: Shortly, I should like to speak to Amendment No. 1, but I begin by referring to more general remarks that fell from the lips of the noble Lord, Lord Howell of Guildford. He discussed the broad, general purposes of the treaty and its likely overall effect. My points are technical, and can therefore can be easily disposed of. The Bill amends an existing Act of Parliament—the European Communities Act 1972—by virtue of which, as Members of the Committee will recall, this country became adjoined to the then Common Market. That raises certain complications, such as those of interpretation.
	I remind the Committee that when it comes to the amendment of treaties that affect the European Community, under the Treaty of Rome the Commission is the interpreter—not our legal brains, of which there are fortunately a plentitude in the Committee. It may therefore be appropriate to cast our eyes over the composition of the Commission and form an assessment of whether they are intellectually—I use that word deliberately—capable of interpreting treaties impartially and in accordance with the open argument that we in this country tend to have.
	I now turn not to the amendment itself, but to its status. According to the Explanatory Notes, the Bill comes into operation on Royal Assent. We are also told that it is necessary for us to pass the Bill and for it to be enacted so that we can ratify the Treaty of Nice. That sounds a little peculiar to me. What happens if, after all the time that we are bound to spend on our deliberations, the treaty is never ratified? Is all our work to be completely in vain?
	The Explanatory Notes state:
	"The Treaty of Nice reforms the institutions of the European Union (the EU) to enable the EU to operate effectively".
	The last paragraph of page 1 states:
	"The UK signed the Treaty of Nice on 26 February 2001 and this Bill is intended to enable the UK to ratify the Treaty."
	That is extraordinary, because the Bill is due to come into operation immediately it receives Royal Assent.
	I ask a purely technical question. There is probably an easy answer. I am not familiar with all the items of procedure. It seems likely that at least two member states will not ratify the treaty. So the Bill may never come into operation, and the European Communities Act 1972 will remain undisturbed. There may be a way to deal with that. I may have misrepresented the position; if so, not knowingly. I should be grateful for an account from the Government—and possibly from Her Majesty's Opposition—of how they view the position. If the Irish, for example, refuse to ratify the treaty, what will happen to the Bill? What will happen to the amendments to the 1972 Act?
	I turn to the amendment, which deals with the question of someone being satisfied or dissatisfied with the way in which the United Kingdom conducts its economic affairs. Under Article 7 as drafted, that is a matter not of speculation but of proof, although who is to prove that the United Kingdom has not obeyed or complied with acceptable European Community economic policies is another question. That is now to be decided on suspicion. Who will have such suspicions?
	We can only speculate. Let us speculate that France, for example, has an objection. That would be a bit odd, would it not? France is well known only to obey EC regulations when it suits. It is hardly in a position to judge whether the United Kingdom has properly obeyed liquidity rules, or is in danger of adversely affecting the economies of Europe.
	As I said, in practice the Commission will make the determination. What the Council of Ministers or the European Council—the status of which, by the way, is nowhere defined in the treaties—will do about that is another matter. Those questions require answers.
	As for the Commission, well, well, well; oh dear, oh dear! The Commission and its directorates remain largely unchanged from the Commission that was severely castigated by the six wise men appointed by the European Parliament, who concluded that they could find no commissioner with any sense of responsibility. Those guys are still there, despite that indictment. Should we not be extremely cautious before devoting much more time and energy to considering the Bill? Would it not be better to wait for ratification of the treaty, combined with what, I take it, would be our speculative approval?
	I am not sure how in parliamentary language, in this place and another place, one ranks speculative decisions. So far as my knowledge of the law is concerned—it is not all that good; I defer to lawyers in that regard—it is not a term we use. We do not arrive at speculative conclusions. Parliament deliberates; Parliament decides; and in due course the legislation is enacted; it receives Royal Assent and it comes into operation.
	I suggest to the Committee that those questions may perhaps be regarded as procedural. But I regard them as a matter of detail requiring our attention. It may be that the Committee will decide that it is inappropriate for us to proceed further. It will save me a lot of time, and I am sure that it will save others a lot of time also.

Lord Renton: The noble Lord, Lord Bruce of Donington, raised a matter of importance not merely in relation to the drafting of this Bill, but also in relation to the constitution.
	As I understand it, the Treaty of Nice, like other treaties, cannot come into force until it has been ratified by each of the members which purport to be a party to it. It would help to clarify our minds if we knew to what extent the treaty has already been ratified. If it has not been ratified by all the purported signatories, then, as the noble Lord, Lord Bruce, said, this Bill is insignificant and it is a waste of time for us to be asked to enact it. I hope that the noble Baroness, who will no doubt reply on this matter, can clarify that point.

Lord Wallace of Saltaire: I hope that it is not being suggested by the noble Lord, Lord Renton, that Britain should always be the last to ratify any treaty revising the European Union. The suggestion that we should be among the early ones is much more desirable.
	Perhaps I too may make a few general points while also making the plea that we should treat the Committee stage from now on as one which addresses the amendments and does not raise general points about the European Union and Britain's membership of it. If we see the Committee process as an area in which we contribute to public education and explanation, it will be helpful to address the changes proposed in the Bill itself.
	I welcome what the noble Lord, Lord Howell of Guildford, said in his opening remarks regarding Conservative thinking on the future of the European Union. After all, we are going directly from this consideration of the ratification into preparations for the next intergovernmental conference, which I suspect will be a much more important revision of the treaty than the relatively modest set of changes we are currently discussing.
	I particularly welcome the suggestion from the noble Lord, Lord Howell, that consolidation of the treaty is something that the Conservatives will accept. That is one of the major issues on the agenda for next time. I was a little surprised when I saw the amendments tabled by the Conservatives in this Chamber. They drew heavily on the amendments tabled by Bill Cash in another place, which seemed to me to be remarkably Euro-sceptic, if not in some ways Europhobic. But if we are to use them as a means of teasing out what the implications are for Britain, that is entirely as it should be.
	In terms of making things clear to the public, my noble friend Lord Phillips of Sudbury tabled an amendment for a later stage which I hope will attract Conservative support. It suggests that the Government need to put into more simple language what the constitutional and political implications of these changes are for the British public.
	There is some history behind the proposals to revise Article 7. As I remember, it was in 1978 that the then British Foreign Secretary, the then David Owen, proposed that the European Council should issue a declaration on what the Community should do in case a member slides back from full democratic standards. At the time he was looking ahead to the forthcoming membership of Spain, Portugal and Greece, then applicants which had only recently returned from more proletarian military governments to democracy.
	We have before us a gradual strengthening of the conditions against the possibility that some member state may begin to backtrack from full democratic standards. With the prospect of enlargement moving from 15 to 25 states, that is clearly something we need to consider.
	I agree with the noble Lord, Lord Howell of Guildford, that the Austrian experience was difficult and far from happy. The Belgian Government rather overplayed their hand. The revised wording and arrangements in that respect are therefore an improvement. We are not talking about a serious breach in itself, but about a clear risk of a serious breach. Where that question arises—none of us can predict in which potential or current member state such a situation might arise—the Council of Ministers and the European Council can discuss it. We therefore support the revision of Article 7 and give the Government our support in that respect.

Lord Willoughby de Broke: I rise to support the amendment to Article 1 proposed by my noble friend Lord Howell. I cannot agree with the noble Lord, Lord Wallace, that it is better to discuss a potential breach rather than an actual breach. I remember when the Austrian question arose last summer. The noble Baroness, Lady Scotland, who answered at that time for the Government, in reply to questions from the noble Lord, Lord Chalfont, said that they would act only should there be an actual breach; that the European Union would feel threatened only if there was an actual breach.
	I cannot see how the idea of some sort of potential, hypothetical risk can or should entail the severe punishment they have vested on the state that commits or is in danger of committing what is called a "clear risk of a serious breach". That includes suspending its vote; suspending its veto and going ahead with all the legislation but without the participation of that member state. That member will not actually have done anything. It will simply have been determined by a majority of four-fifths that there might be a risk that it will do something.
	Surely we should know what is meant by a "clear risk". It is difficult to define. Also, what is a "serious breach" as opposed to a "breach"? Where does it come in? Who will decide what is a "serious breach" and what is a "clear risk"? A state which is deemed to have come to the pass of creating a serious risk can suffer serious consequences. We heard the precedent of last summer's Austrian experience, which was not very happy.
	The article as it stands could in fact be anti-enlargement. It will make it more difficult for some of the candidate states to support their proposed membership. If their electorate elects somebody who is not to the taste of the other members of the European Union, they may say, "I am terribly sorry, we are not going to allow you to participate in the decisions". That is neither democratic nor forward looking when it comes to enlargement. It supports the thinking that this treaty is not so much about enlargement as about increasing the powers of the European Union and the Commission as they now stand. I shall therefore support my noble friend if he decides to take this matter any further at any stage.

Lord Williamson of Horton: I thought that I clearly understood Article 7, but after 42 minutes I am beginning to be a little less clear. Therefore I should like to pose a number of questions to the Minister.
	First, can the noble Baroness confirm that we are discussing the reference in the treaty to,
	"liberty, democracy, respect for human rights and fundamental freedoms",
	and that is all; that we are not talking about economic measures or anything of that kind? That is my first point.
	Secondly, it is clear that in the revised text for the first time there is the introduction of reference to a risk of a serious breach. That is an important point—I understand that—on which a number of noble Lords have commented. Thirdly, what happens if the treaty passes and there is determination of a clear risk of a serious breach? As I understand it, it is open to the Council to address appropriate recommendations to the state in question. That is what we are talking about. As I understand it—this is a question to the Minister—the further provisions regarding voting rights and so forth apply only where there has been a determination that there is a serious and persistent breach; not just a clear risk. That comes under paragraph 2. The question of voting rights does not arise. That is not relevant to the amendment, which makes possible only recommendations to a member state. That is a question for information.

Lord Biffen: We are enjoined by the noble Lord, Lord Wallace, in rather magisterial fashion, to be restrained and relatively narrow in our address to the amendments. I sympathise with that aspiration. However, when we proceed with European law by treaty, one of the difficulties is that we are almost boxed into generalised discussions. The existence of prerogatives in matters which were raised by the noble Lord, Lord Bruce, deprive us of what would otherwise be the robust Committee stage that normally attends domestic legislation.
	However, for what it is worth, my interpretation of the amendments coincides with that of the noble Lord, Lord Williamson. I question whether one should put at risk the utility and durability of Community law by having this kind of legislation. I question whether it is a dangerous squandering of Community authority to have it invested into those kind of aspirations, for what are they? Apart from the omission of sliced bread and motherhood, they are pretty well everything that could command general assent everywhere. We talk about the Union being founded on the principles of liberty, democracy, respect for human rights and fundamental freedoms and the rules of law. Those are principles which are common to the member states. Indeed, that is reasonably self-evident and does not need to be written into any law. But once it is there, if only as aspiration, it becomes a hook which will land unpleasant and, in my view, wholly avoidable situations.
	Mention has been made of the election of the Freedom Party to be part of the Austrian Government. That was picked up with particular zest by the Belgians. In my judgment that was a reflection of the Belgians' domestic political situation, which is racked with ethnic politics. Therefore, the Belgians were much more conscious of how that might react within their own domestic situation than of any of the noble aspirations enshrined in what is to be Community law. Having seen that example, perhaps I may quote the words of Aneurin Bevan, "Why look in the crystal when you can read the book?" The book is there for that one particular incident. It is the crystal which looks to the future where, I am afraid, the people of Europe and of a larger Europe will not have the nice, cosy, consensual judgments which combine the European Commission and the elite that sustains the Commission. They will be running off, perhaps following green politics, or global militant politics, all of which will be much more forthright challenges to the principles of the European Union than anything essayed by Haider and his modest band of followers in Austria.
	At one read, I regard the existence of Article 6.1 in the Treaty of Amsterdam, now invoked in the legislation before us, as being declaratory and not worth too much bother. However, at heart I feel that there is the implication of dangers which arise from definition and from who makes the definitions. That then becomes part of the internal struggles which characterise the institutions of the European Community. That is not the way forward with a sense of idealism for the larger Europe. That is a steadfast determined retreat backwards.

Lord Stoddart of Swindon: I agree with the noble Lord, Lord Wallace, when he says that treaties should be written in a way people can easily understand. I do not refer to people in this place and along the corridor in the House of Commons. I refer to the people of the country. It is their lives, their countries and their laws which are at stake.
	I certainly agree with the noble Lord on that point. I tend to disagree with the noble Lord's comment that we should confine ourselves to the narrow amendments on the Marshalled List. Unfortunately, we cannot do that. The growth of the European Union comes about in steps. One has to "nit pick" every little part put into a treaty before one can understand it. Therefore, it is sometimes necessary to range wider than the narrow amendment under discussion.
	Amendment No. 1 is an attempt to regularise procedure following the precipitate and wholly undemocratic action—let there be no mistake; it was wholly undemocratic—of the Portuguese presidency following the formation of a coalition government with the Austrian Freedom Party, which had gained 28 per cent of the popular vote. That is why this has come about. Because of that position, the EU made a great fool of itself. It is a great pity when an organisation makes a fool of itself unnecessarily and has to climb down from the position it took.
	One of the worrying aspects about this matter is that the countries which are most at risk are the small countries, not the big countries. I refer to an article by Jens-Peter Bonde, a Danish MEP.

A noble Lord: Oh!

Lord Stoddart of Swindon: Noble Lords may laugh, but we must be careful. We are democrats. Jens-Peter Bonde has been elected by the people of Denmark on the basis of his policies and principles and what he has told them. He represents them. Therefore, he is an important figure. The fact that he happens to take a different view from some of my noble friends is irrelevant. He is entitled to put his views.
	I shall refer to one or two of his comments. First, he states that the Treaty of Nice creates a legal basis for punishing countries that might be a thorn in the flesh of 80 per cent of the EU members. That is the view of a representative of a small country, which is concerned. We should take account of that view. He goes on to state that what is new is that a majority within the EU is being given the opportunity to criticise and react before any breach of the rules has taken place. He is worried about that matter. He states that a country can be punished for the prospect that a breach of some incidentally very vague rules might occur. I reckon he has a point. People would be punished before they had committed a crime. I have always believed that a person should be punished only after he or she has committed a crime and after he or she has been tried and sentenced in a court of law.
	Therefore, I believe that Jens-Peter Bonde has a point to which we should listen. But will that apply only to small countries? I believe that it already does. Take the case of Italy where a supposedly right-wing government, under Signor Berlusconi, was elected. I believe that they are governing without a coalition. That is a big country, where a right-wing government has taken over. I believe that that government is more right wing than the Haider party.
	I turn to the racist remarks that Signor Berlusconi has made recently. He claimed that Western values are superior to those of Islam. If Mr Haider had said that he would have been out on his ear, but because Signor Berlusconi said it there is a strange, deep silence. No wonder Jens-Peter Bonde is concerned that it is only small nations that will be hit.

Lord Tomlinson: My Lords, I am grateful to my noble friend for giving way. Does he agree that that great guru of Danish politics, Jens-Peter Bonde—although certainly elected to the European Parliament—because the Danish electoral system is proportional, represents a smaller number than any of the other parties—the Danish liberals, the Danish conservatives or the Danish social democrats—who clearly gained substantially more votes than the former bag-carrier to James Goldsmith, who represents rather eccentric views?

Lord Willoughby de Broke: Is that not a matter for the Danish electoral system and not for the noble Lord? If he has a problem with that, perhaps the noble Lord should discuss that with the Danes?

Lord Stoddart of Swindon: I am surprised that my noble friend should take that view. In that case, at least half, and probably many more, of the Members of the House of Commons do not speak for the people they represent. Jens-Peter Bonde is entitled to his opinion. In a situation of free speech—I do not know how long that will last—he is entitled to put his point of view. Anyway, in spite of his disgraceful remark about the West and Islam, Berlusconi is still in office and the fact is that he is a right-wing party leader who leads a right-wing government.
	The treaty refers to freedom and democracy, freedom of speech and so on. Under those circumstances, does this country qualify? The Government have published a Bill that will enable them to imprison people for six months without charge or without trial and they plan to amend the Human Rights Act to achieve that. Under these provisions will that be legitimate? Or are we undermining such people's human rights and amending the Human Rights Act, to which we have only just agreed, in order to achieve that? We have to ask whether that is in accordance with this particular amendment in the Nice treaty.
	Also in prospect is a Bill to restrict free speech in relation to religion, not to mention attempts to restrict the rights of people to be tried by jury. Will we run foul of that provision? Will we have our rights taken away from us? What about trial by jury and our fundamental freedoms? Interfering with them could be a breach of Article 6.1. Then there is the Prime Minister's obsession with this new world order and his wish, seemingly, to impose it on everyone, whether they like it or not. Does that accord with the democratic principles espoused in Article 6.1? I think not.
	What about the punishment of an erring state? There could be the suspension of certain rights. I am not sure what rights those are, or what that means. Austria was sent to Coventry, as we have just heard. Incidentally, Austria was sent to Coventry not for a persistent breach of this article, but for one particular breach, if it was a breach at all. It was sent to Coventry and its MPs were ostracised.
	Instead of knuckling under, suppose Austria had said, "To hell with you; if you are going to send us to Coventry, if you are going to ostracise us, if you are going to refuse to talk to our foreign secretary and if you are going to refuse to have photographs taken with us, we will not pay you any contributions". What would happen if a country were to take that view? If it were a big country, it could say, "We have had enough of this nonsense, so we are going to leave the European Union altogether".
	It is all very well to say that we shall punish people who we believe have broken certain principles and rules, but those people have powers as well. I am unsure that this provision has been thought out properly. I feel sure that those who have negotiated the provision did not understand the consequences and, therefore, the House should reject the provision.

Lord Hannay of Chiswick: I suggest that those who have mildly mocked the European Union's handling of the case of Austria have made a powerful case for these new treaty provisions. It is precisely because the European Union tried to make policy on the wing, and was not particularly successful, that its member states have collectively—all 15 governments, including the Government of Austria, have signed this treaty—decided that it was more sensible to try to codify such practices and to avoid the need to make policy on the wing in the future.
	My second point is that they clearly decided—I believe that they were right to decide—that it was better to act in a deterrent manner than to be forced to take the stronger action laid down. Hence the talk and hence the possibility to issue recommendations that have no binding legal effect, but which would be a shot across the bows in a situation that appeared to deny certain basic principles of the European Union.
	The third point, which in my view establishes the case for these provisions, is that at the moment the European Union is negotiating with 12 countries which want to join and a thirteenth country—Turkey—which is a candidate but which has not yet opened negotiations. In all those negotiations the European Union quite rightly is observing the Copenhagen criteria, which are precisely the criteria that are described in this provision: an absolute requirement, first, for opening negotiations and, subsequently, for joining the European Union.
	Surely it is right that we should be prepared to apply the same criteria to ourselves as we apply to the new candidates. Surely it is right also for the European Union not only to bind the candidates during the period before they join the European Union but to bind all of us to observance of those standards within the European Union.
	That is the purpose of the provisions and I believe that it is perfectly sensible. Given that, so far as I hear from the debate, not a single person has challenged the basic principles or suggested that they are not those which ought to underlie the EU, I do not see that there is a good case for suggesting that these treaty provisions are a mistake. I therefore believe that the amendment does not stand up.

Lord Pearson of Rannoch: I rise briefly to support the amendments and to touch on a couple of the generalities that have been mentioned. In fact, one matter has not been touched on, so I shall do so.
	The noble Lord, Lord Wallace of Saltaire, in his disagreement with my noble friend's amendments said that he thought they were not just Eurosceptic but were bordering on the Europhobic. I do not know whether I have previously crossed this sword with the noble Lord, but I have certainly crossed it with his colleagues on those Front and Back Benches. The point is that I hope we shall be careful in using the word "Europhobic".
	As I have had occasion to mention previously, the word "Europe" seems to have been appropriated by the Europhiles in this great debate to mean both the continent of different nations and the emerging EU megastate. We Eurorealists or Eurosceptics, which is as far as we would go, love the Europe of different nations. We love and respect their cultures and their histories and pretty well everything about them. However, we dislike the emerging European megastate. We dislike the Treaties of Rome and pretty well everything that comes out of Brussels.
	Our problem is that if a Eurorealist is rude about "Europe", referring to a product of the Treaty of Brussels, he is easily cast as Europhobic, or a little Englander, or a dangerous nationalist. Therefore, I must put that point to Members of the Committee and ask them not to use the word "Europhobic" or any of the other derogatory descriptions which I fancy the noble Lord, Lord Wallace, and his colleagues might be thinking of applying to, shall we say, myself. I hope that they will not use that word in these debates unless it is clear what some of us are phobic about; and that is, Brussels and the treaties; not the glorious nations and cultures of Europe.
	I want to make one other generality. I am sorry that I was unable to be present at Second Reading—I was on business in the Far East—because in reading the debate I did not notice many noble Lords declaring an interest in the matter. Nowadays, with a new register on the way, we are all supposed increasingly to be declaring our interests. I am aware that among your Lordships there are several former European Union Commissioners, MEPs and so forth. Others have been associated with our glorious foreign service and the general progress of the European saga to where we stand today. I believe that in one way or another some noble Lords may even be in receipt of the occasional pension from the European Union. I hope that when noble Lords intervene, perhaps as forcefully—

Lord Wallace of Saltaire: If we are to have a disarming agreement, I shall promise not to say "Europhobic" if other noble Lords will promise not to make references to Commission officials who are pensioned off and who have a right to intervene, such as have been made on many previous occasions. If we could have fewer attacks on the dreadful Commission, I promise not to use the word "Europhobic".

Lord Pearson of Rannoch: I am grateful to the noble Lord for his intervention. I am not sure that only former Commissioners are involved because I was making the point that MEPs and people generally who have been associated with the grand strategy should declare their interest. It helps us to understand their background and where they are coming from in a debate. Of course I entirely agree with the noble Lord, Lord Wallace, that if there is a pecuniary interest it should be declared by those noble Lords concerned.
	That is all I want to say about the amendment. It deals with generalities and I support it. The business of ostracising countries because there is a belief that there is a risk of something happening is dangerous and unacceptable.

Baroness Symons of Vernham Dean: As the noble Lord, Lord Howell, made some preliminary remarks, perhaps I may do likewise and make a couple of general points. I welcome the statement that the noble Lord made at Second Reading. He pointed out that,
	"The Bill was approved with the usual very large majority on Third Reading in another place. It is not our custom or job to oppose it on Second Reading. It is, however, our job to seek to scrutinise, to seek to amend and to improve it as best we can . . . That is what we seek to do".
	The noble Lord made much the same point again today when he said that the Opposition sought to scrutinise and improve the Bill. However, I am bound to say that a number of the Opposition's amendments would, if approved, wreck the Bill. They would prevent UK ratification and they would stop the Nice Treaty. The effect would be to prevent enlargement in any practical sense and to deny to the United Kingdom the benefits which flow from enlargement and from the Nice Treaty.
	The noble Lord, Lord Howell, also told the House at Second Reading that,
	"there is nothing whatever that is anti-European in the constructive but undeniably quizzical approach that we take".—[Official Report, 1/11/01; col. 1523.]
	Again I welcome that approach, but some of the opposition amendments appear to exhibit the very same "anti-European" approach which would characterise some of the submissions made by his honourable and right honourable friends in another place and which I understood the noble Lord rightly repudiated at Second Reading.
	Perhaps I may say to the noble Lord, Lord Pearson of Rannoch, that trying to censor other noble Lords' language during our deliberations on the Bill is unrealistic. If we were all to make a list of the pejorative descriptions of each other's positions, we would be here a very long time indeed.

Lord Pearson of Rannoch: I am grateful to the noble Baroness. I was not trying to censor what noble Lords are trying to say; I was merely trying to define what I hope they mean.

Baroness Symons of Vernham Dean: In doing so, inevitably the noble Lord will excite other noble Lords to define what they think he means by some of the terms he uses. I suggest that that is not a tremendously fruitful path for us to tread.
	In addressing Amendments Nos. 1 to 6, Members of the Committee may want to reflect on the fact that the European Union is founded on certain principles. We have rightly come to expect the highest standards in respect of human rights in European Union member states. If the EU is to continue to provide a model of stability, we must ensure that others continue to have faith in our commitment to individual freedoms and to fundamental rights.
	The ability to suspend voting and other rights of member states which do not live up to those expectations already exists in the Treaty of Amsterdam, which passed through your Lordships' House some couple of years ago. Nice does not change those procedures for action against any member state which has persistently breached human rights. The Treaty of Nice seeks to introduce a new early warning system. It is not a speculative weapon in the sense in which the noble Lord, Lord Howell, characterised it; it is an early warning system, which we believe would be enormously helpful.
	Perhaps I may try to explain a little more about why we believe that such a mechanism is desirable. It must surely make sense that the Council is able to investigate the possibility of serious infringements of human rights before they are committed the better to prevent them and not just to act after freedom has been violated. In that respect I do not believe that there is any difference in what is being said here and what my noble friend Lady Scotland of Asthal said, to which the noble Lord, Lord Willoughby de Broke, referred.
	The Treaty of Nice provides that this risk can be established by the Council acting with a four-fifths majority of its members. That may lead to recommendations being made to the member state concerned. The four-fifths provision is itself insurance against arbitrariness. Furthermore, prior to its decision the Council can ask for a report from independent experts, who must listen to the views of the member state concerned. There has been a great deal said on these provisions and this particular article. It has been claimed that it might be used to suspend the voting rights of those who do not share a federalist vision. That is not so. Others have claimed that it would be used to intervene in British politics or daily life. Again, that is not so, because the article relates solely to breaches of fundamental human rights. It may only be used in that context. It says so in the treaty and the treaty is law. A four-fifths majority must be attained to establish a risk of a breach of human rights. To eatablish that a breach has taken place the unanimity of all member states, except the government of the member state in question, is still required. So the Government believe very strongly that breaches of human rights cannot be tolerated in the EU and this clause gives the strongest possible message to existing states, applicant member states and the outside world that we really mean what we say. That is why the Government support it. Perhaps I may pick up on a couple of the points made. I agree with the noble Lord, Lord Stoddart of Swindon, that it is desirable that we clarify treaties. That is a point on which the noble Lord and I can agree. I point out to the Committee that this is one of the elements which will be taken up in the IGC in 2004. The simplifying of treaties inter alia is one of the issues that the Government agree should be looked at. We believe it to be an important point for the future. I am grateful for the excerpts which the noble Lord was kind enough to read to the House. I point out to him that the government of this country are also elected: rather more importantly, they are elected by the people of this country. The noble Lord, Lord Bruce of Donington, was worried about interpretation. I hope that he will be comforted by the knowledge that that is a matter for the European Court of Justice and not for the Commission and the Commissioners. Therefore, I believe that a number of the points that he made about them, interesting though they were, are not strictly relevant to this issue. Of course, there are different ratification procedures in a number of different countries, which vary from treaty to treaty. In this particular case the noble Lord is quite right. All countries must go through the process and all must ratify. If Ireland does not do so the treaty will not come into force. It really is as simple as that. The noble Lord, Lord Renton, asked who had ratified. Denmark, France, Portugal and Luxembourg have already ratified. All the other countries except Ireland are, as we are, in the middle of parliamentary consideration. I reiterate—

Lord Renton: It is very good of the noble Baroness to give way. The point that the noble Lord, Lord Bruce of Donington, made is a well established and fundamental one. The reason for it is this. If only a minority of the signatories to a treaty can persuade their parliaments to endorse it, the treaty must fall. If one, two, three or four countries fail to ratify out of 12 there is equally a very difficult situation because it is often the case that, unless the terms of a treaty are applicable throughout the group of countries which sign it, it will not be effective. I believe that that is true of the Treaty of Nice. If that treaty was not generally accepted within the European Community it would cause great difficulty and embarrassment.

Baroness Symons of Vernham Dean: I believe the question as regards the Treaty of Nice is a simple one. All countries must ratify it before it can come into force. It is not a question of only a minority or just one: if any single country fails to ratify, the treaty does not come into force. Other treaties require a different number of signatories for them to come into force. But everybody must ratify the Treaty of Nice or else it does not come into force.
	I hesitate to cap the remarks made by the noble Lord, Lord Hannay of Chiswick. With his usual staggering clarity of mind he came right to the point regarding these amendments. The fact is that the Council may address the recommendations of four-fifths of the member countries as regards the state involved. That is at the stage of a clear risk of a breach. Four-fifths have to agree that there is a clear risk. They can take expert advice and they have to go to the country concerned to ask for its views. But the rights of the state under threat cannot be suspended. That can only be done by the existence of an actual breach.
	Those Members of the Committee who are afraid that there is a loss of rights because four-fifths believe that there may be are not correct in that assumption. The actual breach has to be established. The measures take by other EU member states as regards Austria were taken outside the treaty and the noble Lord, Hannay of Chiswick, was quite right in saying that that did not result in a happly position. It is very much to be hoped that the provisions in this treaty will obviate that kind of eventuality.

Lord Stoddart of Swindon: I have listened carefully to what the Minister has said. There are two points on which I would like clarification. First, are we now to understand that this new provision has been written into the treaty because of the situation into which the EU got itself over Austria? Is it now admitting that the situation was badly handled and, as the noble Lord, Lord Hannay, intimated, this new provision is to prevent that from happening again? The noble Lord shakes his head, but I would like to hear the ministerial reply because it appears that that is what is being said. I would like clarification.
	The other point is a serious one. It has been raised not only by Denmark but by other small countries as well. What happens if one of the "big four" is thought likely to breach these principles? What will happen about them? We need an answer to that because the indications so far from the Berlusconi affair are that big countries can get away with it but small countries cannot. I am sure that the noble Baroness will understand the seriousness of these questions.
	I also thank the Minister for enlightening me about measures to be taken—I hope that they will be good ones—to ensure that in future the treaties can be understood not only by us, although that is seldom the case, but the population as a whole.

Baroness Symons of Vernham Dean: First, this step is not being taken as a direct result of what happened in relation to Austria. This is a warning mechanism which member states believe will be a very useful addition to the available tools relating to human rights. The mechanism is designed to be helpful to a country that may be thought to be in breach of human rights. It allows for such a country to be approached and to state why it does not believe that it would be in breach of human rights. The noble Lord, Lord Hannay, said that the example of Austria might not have happened had such a mechanism been in place. Irrespective of that, this is a useful mechanism which deserves to be supported in its own right.
	My noble friend referred to the observations of a Danish parliamentarian about what would happen if one of the bigger member states of the European Union was in breach. A bigger country would be in exactly the same position as a smaller one. If it happened to be the United Kingdom—which under this Government would be very unlikely—four-fifths of our partners would be able to approach us and take expert advice. We would be able to defend whatever had given rise to the concern. There is no difference between large and small countries.

Lord Howell of Guildford: I am extremely grateful to the noble Baroness for clarifying a number of important issues. I was a little disappointed by her prediction that some of the future amendments would wreck the Bill or prevent enlargement. I do not believe that that is so. We shall be able to produce convincing reasons why that is incorrect, but that is for debates to come.
	I do not want to disappoint the noble Lord, Lord Wallace of Saltaire, about my views on constitutions, single consolidated treaties for Europe, and so on. If I gave the impression that I thought that that was a good idea I was wrong. I hoped I had indicated that while a good number of people were attempting that Augean task I was convinced that it would fail. It is an attempt to impose a fixed order of things and competences on a highly fluid and ever-changing situation. Before the ink dries it will have to be amended yet again, so I believe that that is a failed mission from the start.
	My noble friend Lord Biffen talked of the real difficulty involved in employing narrow precision when dealing with laws under the treaties of the European Union. Therein lies the heart of the problem. These laws are binding, yet in some of the excellent consolidating volumes about the treaties and perspectives with which we have been supplied it is pointed out again and again that,
	"the wording of these laws is more general and looser than the precision of English statutes".
	As a consequence, the precision comes in secondary legislation—regulations, directives and the other cascade of instruments—which is incorporated into our law. The situation probably cannot continue, but that is a matter we shall debate in future.
	As to breaches of human rights, as the noble Lord, Lord Hannay, made clear in his intervention, the intention may be worthy and the cause good but vagueness is the enemy. In some senses the United Kingdom may be about to breach what some may call human rights—matters to do with detention without open trial—in the perfectly proper interests of national security. I only hope that the UK does not get into trouble with the European Union—certainly, the Government will encounter it from other quarters—in respect of that matter and the definitions of human rights which nowadays are as long as a piece of string. Those concerns remain in our minds. However, in view of the clear explanations that the Minister has given and the need to move on to other amendments, I do not intend to press the amendment.

Lord Bruce of Donington: Before the noble Lord sits down, can he give the Committee an indication as to whether he concurs with the extremely terse observation of the leader of the Liberal Democrats that the treaties are largely unintelligible?

Lord Howell of Guildford: I did say as much in my opening remarks. Like other noble Lords, I had enormous difficulty working out with which of the two running treaties, the TEU and TEC, we were dealing. Prompted by the noble Lord, Lord Wallace, and in the cause of education, at the beginning of each future debate I intend to indicate what I believe to be the treaty elements on which we are focusing and seeking to amend.

Lord Stoddart of Swindon: Before the noble Lord sits down, he indicated that he was perfectly satisfied with the reply of the Minister and would withdraw the amendment. Will the noble Lord return to this matter? I am not sure that all the Members of the Committee are satisfied by the Minister's observations. The noble Lord appeared to be abandoning the point altogether. Instead, will the noble Lord say that he will consider what the Minister has said and may return to it at a later stage?

Lord Howell of Guildford: I propose to withdraw the amendment at this stage, but these are ongoing issues of great importance. I believe that I said in so many words that again and again we shall return to the question of who calls the shots on human rights in which jurisdiction. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendments Nos. 2 to 6 not moved.]

Lord Howell of Guildford: moved Amendment No. 7:
	Page 1, line 9, at beginning insert "Article 1 (other than paragraph 2, subsection 1, revising Article 17 of the Treaty on European Union),"

Lord Howell of Guildford: As I promised, at the start I set out that the amendments in the second group focus on Articles 17 and 25 of the Treaty on European Union, not the Treaty on the European Communities—we shall plunge into that later—for some reason that is not entirely clear to me. The amendments address Articles 17 and 25 which are concerned generally with common foreign and security policy and specifically the idea of developing a common defence policy with the EU as a military power—some say superpower—in the world. It is perfectly true that they do not mention the concept of a rapid reaction force. I should like to ask the Minister whether the treaty base for that particular initiative lies in previous treaties, not this one. However, it is not entirely clear whether the treaty changes in Articles 17 and 25 were and are necessary to pave the way for the so-called rapid reaction force, but clearly they address the position of member states vis à vis NATO and the Western European Union.
	These very important matters are intimately bound up with the whole debate about the development of a common defence policy on which I intend to concentrate my remarks. I intend to draw particular attention to the new clause proposed in Amendment No. 40, which is also part of this group of amendments. That requests the Government to be more forthcoming and clear in their explanations of what is happening in relation to the functions of the Western European Union and NATO and the future of those organisations as a result of the revisions to Articles 17 and 25. Those are areas of enormous controversy.
	I shall deal in later amendments with the question in Article 24 of the development of foreign policy—on the hint of a greater application of qualified majority voting to the implementation of certain aspects of agreed foreign policy. The past few dramatic weeks have produced two remarkably distinct and contradictory views about how the European Union has performed in relation to the global war against terrorism.
	One view is that it has been a bit of a flop; there has been a great deal of argument; and the solidarity of the European Union has not been very evident. The other view is that it has been very evident indeed; and that Europe has spoken with a single voice and done splendidly. The excellent Mr Romano Prodi this morning was reported in the papers as simultaneously holding both views.
	We shall come to that matter later. I will turn instead to the implications of the amendments for future development of common defence. The amendments which the Nice treaty made to previous treaties added in Article 25 an important word. To "political committee" were added the words "and security"—Political and Security Committee. That is part of the move towards greater authority and involvement of that committee in military matters. I believe that the committee is chaired by General Ha gglund. He is a Finnish gentleman. Finland is not a member of NATO. The committee is obviously a very important new mechanism on the scene.
	Can the Minister bring us up to date on how that committee will work with its new and extended remit—Political and Security Committee—and how it relates to the plans for the rapid reaction force? That force will contain 60,000 operational troops. A figure of 240,000 for support troops has been mentioned. How is that getting on? How does it relate to these aspirations for common defence?
	I have made it clear from these Benches before, as have many of my noble friends, that we on this side are greatly in favour of a stronger European defence contribution to global security. We expect increased defence spending—we have not seen it yet—in the member states, compatible with a far more effective European contribution within NATO. We want it to remain within the NATO structure.
	Some of us feel and have felt all along—I know that the noble Baroness does not agree—that this word "autonomy", which first turned up in the St Malo agreements, bedevils the argument. The Nice treaty discussions at the Nice Council seemed to make it crystal clear that the planning arrangements for the future—of which the Political and Security Committee is an element—were to be outside NATO, not within it.
	All through debates on this subject we continue to have unsatisfactory replies on where and how this autonomy is to be expressed. If it is to be outside NATO, why is that so? General Sir Charles Guthrie, who was then Chief of the Defence Staff, said:
	"I suppose it could have been done within the NATO framework, and in some ways it would have been easier".
	But then the French Chief of the Defence Staff, General Kelche, in front of a Select Committee said:
	"We must be able to act alone".
	And SACEUR, that is General Ralston, said in front of members of the other place that he was,
	"deeply worried by any kind of planning separation".
	There were further worries which were articulated: that any kind of planning separation would mean problems about the use and sharing of US intelligence with non-NATO countries. These are worries which remain hanging in the air and need clarifying. That is one of the reasons why we strongly urge the Government to lay a report before both Houses of Parliament showing the implications of exactly what is going on.
	Whether we like it or not, I suspect that this project will go ahead, even if there are difficulties with the Turks. I hope that those difficulties are beginning to be resolved. But the whole project really is not about defence. It is not even about the Petersberg tasks, which could or could not be done separately from the Americans, but with their help and probably with their equipment and back-up and heavy lift and so on. It is about identity. It is about a search for a European identity, because the Europe that people are searching for apparently is one that must have a force, a military expression and a flag. Even a marching song is part of the necessary equipment.
	This is a snark-like hunt for a greater European weight and projection of importance which is dressed up as a security issue. It is an identity issue. It is one that does not fit in to the new international order and the network and nexus of relationships of which the world is now composed. It is a centralising, out-of-date idea. It is a Europe as an upgraded replicated nation state idea, which, as I said on an earlier amendment, does not fit into the modern world. It is also a top-down initiative of the kind with which European citizens are beginning to lose patience. From now on, whatever was achieved in the Monnet years of the first four decades of the European Union, the democratic system will want much more of a direct say in the endless initiatives that come out of the European institutions and the European system. That is in great danger of creating indigestion in a hurry, which loses all historical perspective.
	One of the amendments urges that there should be a report before Parliament as per our new clause. That is the one on which I should like to focus in particular while raising the other points about the evolution of Europe as a military power. That is not what many of us, even now, hope it will be. It should have a higher or more subtle mission than that. I beg to move.

Baroness Ramsay of Cartvale: Perhaps I may comment on one part of the remarks of the noble Lord, Lord Howell; that is, the PSC. Unlike him, I welcome very much the creation of a permanent committee in Brussels to advise Ministers on foreign and security matters. But there was one point raised by the noble Lord which I think is incorrect. I should like the Minister to clarify it. I do not believe that General Ha gglund is the chair of the PSC. He is on the European Union military committee. The chair of the PSC may be Javier Solana, the high representative. He almost certainly would be in times of crisis. But at other times there is a chairman in office, which may be a chair from the presidency country of the time. Unlike the noble Lord, I welcome the creation of this committee. I was pleased that our Government were active in bringing it about.

Lord Tugendhat: Can I ask the noble Lord, Lord Howell, to clarify a particular point? He and I are very much in agreement about the desirability of the United Kingdom retaining the closest possible relationship with the United States. We are also very much in agreement about the desirability of maintaining the integrity and effectiveness of NATO. But he quoted a French general—I do not know what else the French general said—as saying,
	"We must be able to act alone".
	An important point, on which I hope the noble Lord and I can agree, is that although we would always wish to maintain a close association with the United States, and although we recognise that effective action in many parts of the world—including areas on the periphery of Europe—is likely greatly to be facilitated by the participation of the United States, from time to time there may be occasions—one hopes not, but it is possible—when problems arise on the periphery of the European Union which we and other members of the EU must take extremely seriously and perhaps in which we may wish to intervene. However, for perfectly good reasons of its own, the United States may not wish to do so. That could be especially true in the near future as the United States continues to take on a number of responsibilities arising from the war against terrorism. But even the United States does not have unlimited resources. Situations could arise in which intervention is required but where, for its own reasons, the United States would feel unable to participate. On those occasions it would be highly desirable for the countries of the European Union—in particular ourselves, the French, the Germans, the Spanish and a few others, to have the means and the capability to take action. Furthermore, those means should be ready to hand—a fleet in being, as it were. It is necessary, therefore, to put in place a structure beforehand.
	Perhaps I may make one further point. On those occasions when we and our European partners wish to take action but the United States is hesitant about doing so, it would recognise that, if Europe is going to take action, then it had better join in. Thus, on occasion, a European capability could act as a trigger for United States involvement.
	The prospect of a European capability that can be utilised alone, on the one hand, need not be incompatible with the desire to maintain the closest possible relationship with the United States, along with ensuring the greatest possible effectiveness of NATO on the other.

Lord Watson of Richmond: It was very good to hear the statement of unequivocal welcome made by the noble Lord, Lord Howell, for any proposal to strengthen European capability. That is a positive sign. It is clear that a balance must be struck between strengthening European capability and avoiding any question mark over the role of NATO or discouraging the United States from playing its full role. Personally, I agree strongly with the comments of the noble Lord, Lord Tugendhat. The evidence may not be unanimous, but it is overwhelming that the United States wants to see Europe participate more actively in international events. Furthermore, the United States would be encouraged to participate more actively if Europe does so. Thus we are looking at mechanisms to achieve that end.
	As regards the treaty, the revision of Article 17 is appropriate in order to clear away references to the Western European Union. The WEU was created out of an entirely different strategic situation. Noble Lords are well aware that it was born out of the inability to move ahead with the European Defence Community, itself originally formed to address the problems posed to Europe and the international community by German rearmament and so forth. The union has become irrelevant to the current situation. The European identity is now expressed in other terms.
	Article 17 is important because it strikes a balance between European capacity and the essential task of keeping the United States involved. The paragraph which relates to NATO reads as follows:
	"The policy of the Union in accordance with this Article shall not prejudice the specific character of the security and defence policy of certain Member States and shall respect the obligations of certain Member States, which see their common defence realised in the North Atlantic Treaty Organisation (NATO) under the North Atlantic Treaty and be compatible with the common security and defence policy established within that framework".
	That is an important balancing statement. From these Benches, we adopt the attitude that the Treaty of Nice has simplified and clarified matters and does not raise any fundamental doubts over the role of NATO or American participation, all of which we welcome. For that reason, we support the treaty as it stands and we shall not support the amendment.

Lord Biffen: With great diligence, the noble Lord, Lord Watson, has demonstrated how Article 17 can bear the full weight of a general discussion about NATO. I shall not follow him far in that direction since I wish to welcome the remarks of my noble friend Lord Howell. He said that we regard the treaty, and the context in which it is understood, as having profound implications for NATO relationships.
	The majority of the applicant countries for membership of the European Union foreseen by the Nice treaty are equally, if not more, in favour of membership of NATO. It is therefore appropriate, at least in general terms, to regard the evolving nature of NATO in that context. I am fascinated and much encouraged by the interest demonstrated on the part of the applicant countries for membership of NATO. Furthermore, I believe that that process is transforming its character.
	However, NATO has maintained one essential feature; namely, the dominant role of the United States. That is a role which we would do well to reassert, even though it has often been stated in the past. I make that comment because of two immediate prospects which should detain the Committee for a moment. First, I turn to the role of Turkey. That country is just beyond the arras. It is also the country whose application for membership is anticipated, but not formally declared. Yet we cannot discuss sensibly the treaty without bearing in mind the Turkish factor. As a member of NATO, Turkey plays a crucial role as the link between the existing Europe and a wider Europe.
	Secondly, what has only recently arisen is a clear indication on the part of Russia that she seeks and is achieving a measure of détente with the United States. That means that now we can anticipate the prospect of an enlarged NATO being brought within the arch of an improved Russo-American relationship. Perhaps that in itself will influence the character of an enlarged NATO.
	Although my comments may not be directly identifiable with the treaty being discussed by the Committee—I apologise to the noble Lord on the Liberal Benches for having digressed so far—I believe that it is absolutely essential to assert the historic role of NATO as well as the prospective role. That will require a great deal of Euro imagination.

Lord Stoddart of Swindon: The Minister and I have had one or two exchanges over common European defence. Those exchanges, alongside the reactions of various people within the EU—including the President of the Commission—make it difficult to understand exactly what is meant by a common defence. No one would disagree with the notion of defence co-operation within Europe; we have enjoyed that for a long time. NATO has been established for many years and has worked extremely well. Indeed, we may need to seek other ways of co-operating with individual states. Again, nothing is wrong with that.
	However, what is perceived by many people is quite different. It is clear that Mr Prodi believes that we have embarked on building a European army. He said so during the course of an interview published on 4th February 2001 in the Independent and he has said so since then. It is probably my duty to write to Mr Prodi and to ask him exactly what he means because he is in disagreement with the noble Baroness and the Cabinet itself. I shall probably do that.
	It is not only Mr Prodi but other people—perhaps more important than Mr Prodi—who hold that belief. For example, Mr Chirac said in May 1999 that the,
	"European Union can not fully exist until it possesses autonomous capacity for action in the area of defence".
	That is what Mr Chirac said, and he is the President of France. On 4th October 2001, not very long ago, he said:
	"the EU can, on the ground, contribute to peace in the world. Today Europe has a military staff. It is giving itself a force projection capability. It is establishing its own intelligence machinery".
	No wonder people like me—and many people more important—wonder exactly what it is about. If it is simply defence co-operation, there is nothing wrong with it. But if the intention is to create a separate European army, there is a great deal wrong with it and a good deal that can go wrong with it. That is why people like myself and others are opposed to it.
	Perhaps I may ask the noble Baroness how much it will cost this country. There is a great deal of concern, particularly among military leaders, past and present, that British forces are not being given the equipment and the manpower they need to perform the tasks the Government are giving them. It is fairly clear that defence expenditure has not increased in real terms over quite a long period and that our forces are suffering because of it. We need to ensure that this new arrangement will not deplete our forces further for home defence and other tasks, and that British forces will be better equipped and financed than they have been over the past few years under governments of both political colours. It is not good enough. We need to ensure that they are much better financed than has been the case. Perhaps my noble friend—I called her "my noble friend"; my God, I must not do that—the Minister can give me some information about that.
	We are worried that the European defence force will grow like Topsy, as so much has grown like Topsy within the EU over the past 25 years. We know that it now has its own Cabinet, its own Civil Service, its own Parliament, its own courts, its own flag, its own currency. All that is left now is a new army and a constitution. We appear to be seeing those here before us, or at least the nucleus of an army and the nucleus of a constitution, which we shall be discussing later.
	I know that the Minister does not like me, or anyone else, saying these things, but that is how it appears to me and to many people throughout the country. I shall be very interested to hear her comments.

Lord Hannay of Chiswick: Perhaps I may say a brief word about the committee to which the noble Lord, Lord Howell, referred. If I understand it correctly, it is intended, effectively, to turn a committee which was based in all the capitals and met about once a fortnight into a standing committee in Brussels. In my view, that is absolutely necessary once you have a High Representative, Mr Solana, who, under the Treaty of Amsterdam, has been given wide- ranging powers and duties in the field of foreign policy and security.
	The committee should be seen in a quite different way. It will be a way of giving him advice from the member states, which are his masters, and he will be able to use it at any time of the day or night, at any time of the week or month, as a sounding board for his own thoughts and for matters on which he has been working. It is a modest, sensible step forward.
	Most other international organisations which have responsibilities in the field of foreign policy and security, such as NATO or the Security Council, have such committees. In the Security Council it is "the" Security Council and in NATO it is the NATO Council meeting at official level. It is only sensible that the European Union should have an institution of this kind.
	Turning to the wider issue, these debates tend to confuse two issues, one of which is the issue of territorial defence. Members of NATO continue to depend, totally and solely, for their territorial defence on Article 5. That is what we will invoke if we are attacked, and we will join in if another member of NATO is attacked. That of course does not apply to the non-NATO members of the EU.
	In regard to security policy, we are discussing whether the European Union should have some capability to project power as well as trade policy, aid and all the other instruments it has. I believe that it is sensible for it to do so. The tasks which have been identified for the proposed force—peacekeeping, humanitarian and so on—are admirable and do not relate to territorial defence. They do not therefore duplicate those of NATO.
	In the discussion about whether or not there will be duplication and autonomy, a phrase which is embedded in all the texts for this rapid reaction capability has not yet been quoted—that is, that the force should be able to act autonomously if NATO as a whole decided that it did not wish to be involved. That, of course, is shorthand for saying, "If the United States should decide not to be involved". Autonomy is absolutely crucial.
	We have to face the fact that in the future such circumstances are more rather than less likely to occur, whether we like it or not. One of the implications of the events of 11th September and the reaction of the United States is that it will expect the Europeans to handle problems in what it would regard as their own backyard more on their own—in other words, autonomously. The case for proceeding in this way is sound. The amendment would weaken that effort. We would be deluding ourselves if we believed that we will not have to find a response of this kind, on a European basis, to a significant extent in the years to come.

Lord Blackwell: The problem that many of us have with the language of these treaties is that it can evoke a "glass half full or glass half empty" approach, depending on the direction one is coming from. It is almost the nature of treaty language that, because there are compromises hammered out between governments, it may be deliberately intended to be interpreted in different ways by people who have different meanings in mind. One of the concerns that many of us have is that, in the past, we may have been culpable of believing that the interpretation that we in this country put on a set of words was the meaning agreed by everyone else, and we then learned to our cost that others had a different interpretation. That lies behind some of the questions about the language.
	Under Article 25, the provisions of the committee could, as my noble friend Lord Tugendhat said, be considered merely as putting in place a fleet, ready to be used in exceptional circumstances if and when we want it to operate independently. But that wording has to be juxtaposed with the wording in Article 17 of the previous treaty referring to,
	"the progressive framing of a common defence policy . . . which might lead to a common defence".
	As so often, one set of words points to a direction, as against a specific provision which, it could be argued, on its own might mean something much more limited. In this case, Article 25 goes on to refer to the committee exercising political control and strategic direction of crisis management operations. Can the Minister define clearly the term "crisis management operations"? How would it be interpreted? What is a "crisis management operation" and what is a "defence" operation? The meaning may appear simple in terms of shortness of intent and overall size of an operation. But it is against the broader wording of Article 17 that the precise question must be asked. We must ask the Government to attempt to define the term, or to point to the part of the treaty where that language is defined, so as to have clarity in relation to the new provisions.
	For those reasons, I have sympathy with Amendment No. 40 in this group: given all these complexities, should we not have a clear exposition from the Government of how all these changes relate to our existing defence arrangements? The Government's interpretation would be on the record; then, in any situation where there was ambiguity or a difference of opinion, at least we should have clarity regarding what we think we have agreed to.

Lord Phillips of Sudbury: Perhaps I may ask the Minister a question. I apologise for not giving her notice of it. I do not expect her to give an instant response. It is simply that I did not have the opportunity to consider the issue prior to this debate.
	My reference is to Article 17. We have made amendments to Articles 6 and 7—Article 6 stating that the Union is founded on the principles of liberty, democracy etc. and Article 7 dealing with serious breaches of those principles by any member state. In relation to Article 17, would it be possible for a member state to have a foreign or security policy that was considered to be in breach of the democratic policy of the majority of member states so as to give rise to action under parts 1 or 2 of Article 7?
	My second question relates to the language of Article 17.1. It states:
	"The policy of the Union in accordance with this Article shall not prejudice the specific character of the security and defence policy of certain Member States".
	The treaty is a legal document; in effect, it is law. Presumably it is written in terms of such clarity that member states can see whether they are on the wrong or right side of it. I find those words extremely difficult to interpret even in the abstract. I wonder whether they are justiciable. If they are not, in regard to some express anxieties is not the consolation that is being given unfounded? In short, can the Minister give an example where a member state would be entitled under this provision to take action in its own defence against a common policy that was in breach of the specific character of the security and defence policy?

Lord Pearson of Rannoch: One agrees with the noble Lords, Lord Watson of Richmond and Lord Hannay, that the United States would like Europe to do more about its own defence and military action in general, but, as I understand it—and this is the key point—not at the expense of NATO. Perhaps I may put one or two brief questions to the Minister.
	First, has any calculation been made of the extra money that will be required to put this military ambition into operation; and how much has actually been guaranteed by the EU countries concerned?
	Secondly, has the United States agreed that it will contribute all that it is assumed it will contribute, certainly in the French presidency declaration on the European security and defence policy? I refer in particular to Annex VII to the appendix to the French presidency conclusions. We see items such as guaranteed access to NATO's planning capabilities and the presumption of availability of pre-identified assets and capabilities. We also see a paragraph that says that the entire chain of command,
	"must remain under the political control and strategic direction of the EU throughout the operation after consultation between the two organisations. In that framework the operation commander will report on the conduct of the operation to EU bodies only. NATO will be informed of developments",
	and so on. Those are serious questions which might decide whether this thing will ever really fly.
	Leaving the French Presidency Conclusions and returning to the main article, my final question goes a little further than that of my noble friend Lord Blackwell. Article 17.2 states that the new "army", as President Prodi insists on calling it, will be involved in,
	"tasks of combat forces in crisis management".
	This seems to me to be a very important matter. What does that mean?
	I am aware that this phrase appeared in earlier versions of the treaty before Nice came about. But with the new autonomy and powers being granted to an EU army, that particular expression seems to assume much greater importance. To an ordinary mind, the words could surely include what one might call ordinary war. It depends on the interpretation. I do not want to be in the least facetious, but surely it could include putting down civil unrest. Can the Minister give an unequivocal assurance that that source will never, ever, be used, let us say, to disperse a crowd of several hundred UK citizens in Trafalgar Square in 10 years' time protesting about our membership of the European Union?

Baroness Symons of Vernham Dean: There is a great deal of confusion about the issue of defence and the Nice treaty. Perhaps I may attempt to set out the position.
	The arrangements for the European security and defence policy are not in the Nice treaty. A declaration attached to the treaty makes clear that the treaty does not need to come into force for the defence arrangements agreed by EU member states to become operational. The position is straightforward: the treaty is not necessary for the defence mechanisms to come into effect.
	The European security and defence policy had its origins in the Maastricht treaty, which agrees,
	"a progressive framing of common defence policy".
	The Maastricht treaty was introduced when the party opposite was in power. Nothing in the Nice treaty changes that. There is no specific treaty base for the rapid reaction force. The details of the terms for EDSP are not in the treaty of Nice but in the separate political conclusions, which were adopted by the European Council at Nice. It is important to get that point absolutely clear.
	The noble Lord, Lord Stoddart, asked how much this would cost and the point was taken up by the noble Lord, Lord Pearson of Rannoch. There are no additional costs involved in so far as armed forces or equipment are concerned. We shall examine better co-ordination for the Petersberg tasks—I shall discuss that in a moment—as regards armed forces and consider ways in which their equipment may be mutually supportive. That is what both the headline goal—which the Committee has discussed—and the capability conference, which is due to take place in December this year, are all about.
	The additional cost, in so far as one may be attributed to this, might arise in the political and security committee. As the Committee may recall from our previous discussions, that is a small committee; I take into account also the secretariat that supports it. However, there would be offset costs for the disbanding of the WEU. In so far as costs exist, they are not costs for armed forces or for equipment. The sole additional cost would be incurred in the drawing together of the political directing committee.
	I am sure the Committee understands that the treaty removes references to the WEU as that no longer reflects reality. As I have indicated, the other new element is the reference to the new political and security committee which is being set up and to which the Council will, following Nice, be able to delegate individuals for the political direction of operations. It is important to remind ourselves that the EU only exercises high level political military control. There really is not an EU military operational structure. I know that we have been over the issue before in the Chamber but it is as well to reiterate it now. The EU political control mechanisms—that is, the political and security committee and the EU military committee—link with the operation commanders in headquarters, who are either from NATO in the form of DSACEUR and SHAPE and therefore use all NATO's military operational tools, or are from national bases such as our own PJHQ in which case national or NATO resources would be used. Therefore, there is no separate EU military operational structure. I hope that that is clear.
	Having heard what some Members of the Committee have said, one might be forgiven for thinking that, somewhere hidden away in the treaty is a clause which sets up a permanent Euro army or brings under the control of foreign generals our own Armed Forces. That is not the case to any greater extent than exists already. The fact is that British servicemen and women have been under the control of overseas commanders in Kosovo, Bosnia, during the Gulf War and in East Timor and, in fact, in any UN peacekeeping operation to which we contribute troops which does not have a UK force commander. There is nothing peculiar or extraordinary in that and it constitutes no great departure from the way in which we have operated in the past.
	The European security and defence policy is about improving military capabilities of the European nations to conduct certain EU-led military operations. Here we come to what have been termed the Petersberg tasks, defined as those where we would not wish necessarily always to invoke NATO and where NATO might not wish to become involved. They are humanitarian tasks such as the delivery of aid or, for example, the military operation that we undertook to deliver aid to flood torn regions of Africa in the past year or 18 months. They might also involve peacekeeping or peace enforcing—those kinds of crisis management. I stress that that would occur when NATO itself chose not to become engaged in such operations.
	We believe that the ESDP can make a real difference in a practical way. EU member states have committed to overcome important shortfalls in their military capabilities. We have discussed those shortfalls on a number of occasions in this Chamber. I refer to shortfalls, for example, with regard to strategic airlift and the sheer readiness of armed forces to move into action. The capabilities improvement conference, which I mentioned a moment ago, is designed to meet some of those shortfalls. It is a critical step in that process.

Earl Attlee: The Minister told us that we would not incur any extra cost from these arrangements but now she is telling us about improvements in capability, particularly with regard to strategic airlift. We agree that we need improvements in strategic airlift, but what do the arrangements do to overcome our shortfalls in strategic airlift?

Baroness Symons of Vernham Dean: I did not say that no extra cost would be incurred. I said that there were minimal extra costs and that they were not necessarily associated with equipment, for example. I assure the Committee and the noble Earl, who has a particular interest in defence matters, that we would improve the United Kingdom's airlift capacity anyway. The point I am making is that we should examine European capabilities in general and try to determine the best way to co-ordinate those capabilities. We are not talking about additional costs; we are talking about deciding in Europe how our forces intermesh, both in terms of personnel and in terms of the kind of equipment they have at their disposal. Certainly, as someone who was responsible for defence procurement, I am well aware of our shortfalls. Increased airlift capacity was something the UK needed anyway.

Lord Watson of Richmond: The Minister explained the situation with absolutely admirable clarity. But does she not agree that one of the encouraging results thus far of the European defence initiative is that not only as regards the United Kingdom but also as regards other member states there appears now to be a stated willingness to review future purchase of equipment so that it meets the gaps that exist within any European defence capability? That is important because historically in Europe what we have all done is to produce the same kind of defence capability. We have replicated ourselves and that is one fundamental reason why, although within the European Union we spend around 60 per cent of what the United States spends on defence, we only get about a 15 per cent capability from that spend.

Baroness Symons of Vernham Dean: The noble Lord has expressed the point admirably. That is, of course, the reason for going ahead with the capability conference later in the year. It is also, of course, one of the reasons we set up OCCAR; namely, to seek with like-minded EU countries better and more effective ways of defence procurement within our defence budgets.
	Improved European military capabilities will also strengthen the contribution Europeans can make to NATO operations. That is an important point and one that is recognised by the United States and our other allies in NATO. NATO will remain—I echo here absolutely unequivocally the point made by the noble Lord, Lord Hannay—the cornerstone of Europe's collective defence. NATO is, and will remain, our first choice for managing crises. There is no equivocation on those points.
	It is tempting for us all to scan the newspapers to find quotes wheresoever we may in support of the view that we take. But, however hard we try, I do not think that there is any gainsaying the fact that the United States has long wanted Europe to take more responsibility and improve its capability to be a more effective set of allies within NATO. That is what we are doing now and that is why the United States so strongly supports us. I remind the Committee that President Bush said at his meeting with the Prime Minister on 23rd February this year:
	"The United States welcomes the EU's European Security and Defence Policy intended to make Europe a stronger, more capable partner in deterring and managing crises affecting the security of the Transatlantic community".
	It is not just the United States who do not want that to happen at the expense of NATO; the United Kingdom and our European allies within NATO also do not want it to happen at the expense of NATO.
	It is important to repeat that nothing in the Bill involves the establishment of a European army. The commitment of national resources by member states for the operations that I have described will, of course, be based on sovereign decisions. NATO will remain the crucial basis for the collective defence of its members.
	I shall not go into the details of what Signor Prodi said, because I thought that he was unequivocal when the points were put to him on the "Today" programme this morning. The questioner put various words into his mouth, but he pointed out that that position was completely wrong. He went on to explain his position, which was not very different from what I have just explained.
	The noble Baroness, Lady Ramsay of Cartvale, pointed out that General Hagglund heads the military committee, not the political and security committee.
	The noble Lord, Lord Biffen, was worried about the position of Turkey. I remind him that Turkey has supported the development of the ESDP. At the December 2000 ministerial meeting, Turkey and the other allies reaffirmed NATO's readiness to support the ESDP and the EU operation.
	Of course Turkey has some concerns, but the EU's openness to involve non-EU NATO members in Europe in this important step is addressing those points. We shall continue to engage Turkey, because we all understand that it is a much-valued NATO ally. It is very important that we proceed on that basis.
	The noble Lord, Lord Stoddart, raised questions about intelligence, which have been raised in your Lordships' House before. We shall not pass intelligence to the EU unless we are confident that it is as secure as with NATO. I hope that I have dealt with the other questions raised on the Petersberg tasks.
	We do not believe that Amendment No. 40, tabled by the Opposition, is necessary. Few government policies have received as much attention as the ESDP. It is right that it receives such attention, but we have debated the policy a great number of times in your Lordships' House and I am sure that we shall go on so doing. Another government report to Parliament on the implications of the ESDP for NATO and the WEU would not add anything to the information that the Government have been at pains to make available to your Lordships' House already.

Lord Howell of Guildford: My Lords, I am grateful to the Minister for setting out some comments and answers on the debate. I accept that the noble Baroness, Lady Ramsay, is right about General Hagglund. He is a Finn—not a NATO member country—but he is the chairman of the military committee, not the political and security committee.
	I am also grateful to the Minister for her assurance that there is no European army and there will not be one. We accept that as her firm assurance, but there continue to be a great many voices around Europe of a different tone. I suspect that whatever the wishes and policy of the Government, which she has explained with her usual clarity, those other voices will continue to be heard. That is, in a way, disturbing.
	To answer the question put to me by my noble friend Lord Tugendhat, with whom I have discussed these matters at length many times, there may well be occasions when the Americans do not want to get involved in a particular security or enlarged military policing project, although I think that they will be few. For once I disagree with the noble Lord, Lord Hannay, who speaks with such clarity on these matters. He said that after 11th September there would be more occasions when the Americans did not come along with us, but I think the opposite. It seems to me that we are now in a globalised pattern of defence and security against all forms of new threats, many of which were not foreseen. That will involve a much more intimate and continuous dialogue and involvement between the powers, both bilaterally and for those acting in regional groupings, as the EU seeks to do. It will be less, not more frequent for countries to wish to sign off or opt out.
	When those occasions occur, if they do, the matter can be resolved within the present structure and framework of the ESDP, which, as the noble Baroness has just said, the Americans support and which we all think is a reasonable framework of co-operation. However, that is not the same as the rapid reaction force, which is the body of the future and whose authenticity and efficiency, as the noble Baroness rightly said, arises not out of this treaty, but, in a way, out of previous treaties. I shall deal with that in a moment.
	Such a situation can invariably be dealt with by discussion if the Americans do not want to come along. Even if it could not, in practice it will be, because for the foreseeable future US equipment and intelligence will be required. The spending to replace it is not there. The programmes have not been developed. I have heard it frequently asserted by independent authorities that American equipment—which I suppose is NATO equipment—will be necessary even to conduct the most modest Petersberg-type policing tasks.
	All of that reinforces the question mark that there has to be over the idea of a separate operational planning system and separate EU strategic involvement in these matters, which the noble Baroness has described. Even if the spending gets going, there will be duplication. It is already on the cards that there will be additional surveillance and satellite systems. In this very small world of intimate co-operation between London, Paris, Beijing, Tokyo, Moscow, Cairo and so on, one has to ask why such duplication is needed. We need inter-operability and compatibility, so that at least a Belgian tank can ring up a British tank and both can ring up American equipment and make contact and operate together. What is needed is already in existence—the OCCAR system of European procurement co-ordination that the noble Baroness mentioned. That is the practical way forward for us and the United States to continue to strengthen the overall punch, reach and effectiveness of a modern NATO in a transformed world.
	In the words of Henry Kissinger—who is not always right on these things, but on this he is—that means that the whole spirit must be one of partnership, not rivalry. Many of us are worried that the more we hear about the scheme for a separate, autonomous force, the more it is couched in terms of challenging the American hegemony and of rivalry and competition with the United States. That is not the language of the 21st century. It is backward-looking language that will not achieve the security results that we all want.
	The noble Baroness is right that the treaty basis for all this goes back to Maastricht, but since then there has been St Malo and a major development in the concept, growth and emergence of the rapid reaction force as a project. Throughout all this, one has to ask what the accountability structures are. The treaty now says goodbye to the WEU, which is to be disbanded. I do not know whether that applies to the WEU parliamentary assembly, but I imagine that it does. Even its best friends would admit that that organisation could provide only limited accountability. We are moving to an age when much higher standards of accountability on what governments are up to are demanded of the national legislatures of the countries involved.
	It is astonishing that we have not had a comprehensive report—even one as comprehensive and clear as the noble Baroness's speech to the House at 6.30 on a Thursday evening. But we have no formal, clear report showing the enormous implications of what happens now that the Western European Union is disbanded and how the North Atlantic Treaty Organisation will and will not relate precisely to the new defence capabilities about which there has been so much debate.
	I find that to be an amazing lacuna. In an age when more and more democratic accountability is being demanded, in these areas, above all, it appears necessary that governments should keep their legislatures and their citizens fully informed. In a moment I want to propose to the Committee that that particular matter—the lack of accountability, the lack of a report and the absence of real explanation as to how these matters are affected by the Treaty of Nice—should be put to a vote and the opinion of the House tested.

Lord Phillips of Sudbury: Before the noble Lord sits down, I wonder whether the Minister will undertake to respond to the two questions that I raised.

Noble Lords: Oh!

Lord Pearson of Rannoch: We are in Committee. I believe that it is in order for the noble Baroness to reply.

Baroness Serota: Is the noble Lord, Lord Howell of Guildford, intending to move the amendment?

Lord Howell of Guildford: I intend to put the amendment when it has been read out.

Baroness Serota: It has been read out.

Lord Howell of Guildford: In that case, I beg to move that Amendment No. 40—

Noble Lords: We are dealing with Amendment No. 7.

A noble Lord: The noble Lord wishes to press a vote on Amendment No. 40, but he cannot do so.

Lord Howell of Guildford: I understand that noble Lords are saying that we shall come to Amendment No. 40 later. I beg leave to withdraw Amendment No. 7.

Amendment, by leave, withdrawn.
	[Amendment No. 8 not moved.]

Lord Howell of Guildford: moved Amendment No. 9:
	Page 1, line 9, at beginning insert "Article 1 (other than paragraph 4, subsection 3, revising Article 24 of the Treaty on European Union),".

Lord Howell of Guildford: I turn to the amendments which relate to Article 24.

Lord Williams of Elvel: Is the noble Lord withdrawing certain amendments or speaking to different amendments? Perhaps we may clarify the situation.

Lord Howell of Guildford: I am now moving Amendment No. 9, having withdrawn some of the amendments in the previous group but having expressed the wish in due course to vote on Amendment No. 40.

Lord Williams of Elvel: Has the noble Lord asked the leave of the Committee to withdraw the previous amendment?

Baroness Serota: Amendment No. 7 was withdrawn. Amendment No. 8 was not moved. As I understand it, the noble Lord is now moving Amendment No. 9.

Lord Howell of Guildford: That is correct. I understood that I did beg leave to withdraw Amendment No. 7. If I did not, I apologise to the Committee, but that is the position.
	We now turn to Amendment No. 9, which deals with the specific question of a common foreign policy. The amendments to it in the Nice treaty have the effect of extending somewhat—it is not entirely clear how far—qualified majority voting in some aspects. Furthermore, the amendment indicates that where a country opts out of a certain foreign policy implementation, the other member countries may nevertheless insist that it continues to apply provisionally.
	I hope that this amendment will give us an opportunity to look at the question of the superpower concept and at the state of common foreign policy and to see how it matches up to what has been acclaimed for it in recent months and what is hoped for it in the future. As I said in an earlier debate, there is an opinion that it has worked marvellously and that in recent weeks Europe has spoken with a single voice. There is also an opinion, widely shared in the press, that the common foreign security policy was rather "pushed about" by the events of 11th September and by the Afghan war and crisis. The Financial Times' heavy headline of 6th November stated:
	"Europe's great powers break ranks".
	I believe that both views are probably wrong. In my view, and in the view of many of us who are uneasy about too much being claimed for common foreign policy, there is always a danger that these arrangements will be over-institutionalised. There is a constant tendency, to which some of us object, to build up a common foreign policy in an attempt to create a single foreign policy which must somehow be co-ordinated in response to major foreign policy challenges.
	As my noble friend Lord Hurd said in a very interesting lecture the other day, the situation offers a mixed set of instruments. We do not always have to imagine that every foreign policy pattern or situation will automatically be co-ordinated by all the member states. If one does imagine that, there is bound to be disappointment when old bilateral relationships, new bilateral relationships and particular alliances spring up to meet the new situation, as has happened in the past few weeks.
	My right honourable friend in another place, Mr Ancram, spoke about layered responses to the global terrorist crisis. He emphasised the need for all types of alliance and said that it was not always possible to fit the response into the harness of a common foreign policy. In a crisis there are bound to be different needs and different types of bilateral relationship. If one waits for the slowest in the convoy, one waits in vain and probably waits too late.
	I believe that the row—if that is not too strong a word—that arose after the Prime Minister, who seems to me to be performing excellently, gave a dinner party to which he did not invite all member states which felt that they had a right to be involved in a common foreign security policy is a classic example of what happens if one invests too much power in that particular concept.
	In our view, the basic problem is that exaggerated expectations arise from common foreign policy. There is also a feeling that it is a hierarchy and that it must have a central point and club rules, and so on. In the real world, that is not the position. As I said in a previous debate, we live in a network world, which, I agree, is a complicated concept. However, it is one which matches far more closely the pattern of relationships within which Europe and its neighbouring countries must work.
	The further danger of a single common foreign policy is the one to which I referred in a previous debate; that is, that it creates a feeling that Europe must somehow project itself and its weight in the world and that it must project its weight and purposes against something. What is the thing that it is against? It is obviously not the old collapsed and disappeared Soviet empire; it turns out to be the alleged dominance of the United States, with which, as I said earlier, we should be partners and not rivals.
	The other danger to which we return again and again is that a common foreign policy must be worked out. Once it has been worked out in detail, it is set in stone and becomes, in effect, non-negotiable. The Americans may turn up in Europe and speak to Mr Solana. However, if we negotiate very carefully a common foreign policy, then the room for unravelling that negotiation will be almost zero. Henry Kissinger said that he wanted a single voice at the end of the telephone. However, the single voice that one gets may not be one that one likes. That is why we question the proposals, which appear to bring increased use of qualified majority voting into an area in which a much lighter touch rather than the tendency towards centralisation and singularity is needed. That tendency leads to the disappointments that we saw when the doors of the dinner party the other night were closed to some people, to their intense annoyance.
	Let us have common positions on foreign policy with our European neighbours at the right time, but we must be very careful about moving away from unanimity in reaching those positions and even more careful about over-institutionalising common foreign policy and about co-ordination becoming more important than the purpose of the policy. We all remember the disaster associated with the recognition of Croatia. It was recognised because it was felt more important to achieve a common policy than to work out the consequences of that premature recognition. In future, we want less of that, not more. That is why the amendment is necessary. I beg to move.

Baroness Symons of Vernham Dean: Being able to act rapidly in the area of common foreign and security policy is, in the Government's view, vital. We need to be able to respond to new and rapidly changing events. That has been one of the strengths of the CFSP, which has proved itself to be fast-moving and adaptable.
	After 11th September, there is also a greater need than ever for the EU to co-operate with third countries in the fight against terrorism and crime and in relation to the rest of the justice and home affairs agenda. It is therefore right that we should be able to get these agreements in place rapidly and working quickly—that is in the interests of safety and stability. It is also right that we should be able to conclude such agreements by qualified majority voting.
	The essence of the issue is to get the policies right. I say to the noble Lord, Lord Howell, in relation to his point about recognition, that that happened under a Conservative administration. However, the crucial point is that the government of the day should get their policies right in the first place. That is why the decision to use QMV to conclude such agreements applies only when they relate to areas in which QMV already applies for internal EU decisions. When the agreement covers an issue for which unanimity is required for internal EU decisions, that unanimity will still be required to conclude any external agreement—no more than QMV can be used for decisions with military or defence implications. That has an explicit link to Article 23(2). Proper safeguards are written into the treaty in respect of QMV and the veto.
	A vote against the article is a vote against common sense. Of course we must safeguard the right to object to vital policy decisions, including those involving defence matters. We have done that; we said that that is what we intended to do before we negotiated at Nice; and it is what we did there. We should not hold up the implementation of those decisions once they have been made. QMV and the implementation of decisions will mean speedier and more effective responses. It will mean a more effective EU position when taking action on the world stage. That is why the Government support it.

Lord Howell of Guildford: I am grateful to the Minister for her comments. She is right to say that a limited application of QMV is involved. As I said in an earlier intervention, we on this side do not stand on principle against sensible applications of QMV, although each new application is inevitably a constraint on independence of action. However, that is natural in the interdependent world in which we live. We have some unease about the proposal and we may return to it in more detail later. However, in view of what she said, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendment No. 10 not moved.]

Lord Howell of Guildford: moved Amendment No. 11:
	Page 1, line 9, at beginning insert "Article 1 (other than paragraph 6, subsection 2, revising Article 27e of the Treaty on European Union),"

Lord Howell of Guildford: This amendment relates to Article 27e of the Treaty on European Union, which is concerned with enhanced co-operation. There has been prolonged debate about that concept. In this context other words have been used, such as, "flexibility" and "advanced guard"—I am afraid that the phrase in French escapes me for the moment. The idea is that some countries can move in certain directions together. The phrase that is usually used is that they "move forward" together. However, it could be argued that countries that want to lock themselves into a more rigid pattern of co-operation may be not moving forward at all but holding themselves to a single pattern while other countries are freer to move in an agile way in a constantly changing world. The association of progress with enhanced co-operation is not automatic. The idea that more co-operation, like more integration, means moving forward may not involve the appropriate verbs and nouns for the world into which we are moving.
	At Nice, it appeared that while there was agreement that ideas for enhanced co-operation would go forward, it was also assumed by some that the veto of individual countries on an enhanced co-operation project, if one can call it that, would be retained. However, the veto was not retained in the treaty; it was removed. The brake has been removed from the pattern of enhanced co-operation—from using the resources of the Community as a whole. The new developments can go forward—or in whichever direction is appropriate—against the wish of a particular country. We do not like that; we thought that the veto should have been kept. We thought that it was going to be kept, but it was not kept in the treaty. That is why the amendment, which suggests that that aspect should not apply to the United Kingdom, is necessary. I beg to move.

Baroness Symons of Vernham Dean: The EU has been a success for all these years because of its ability to develop and change—because of its flexibility. That flexibility is tested every time that more member states join. In an EU that stretches from Lisbon to Tallinn, it will be increasingly difficult to get agreement to move ahead in all areas with all member states.
	Flexibility in the EU has been called many different things, such as "differentiated integration" and "variable geometry"; and a range of other descriptions have been used by others. In plain English, that means that EU member states do not have to do everything together. It allows smaller groups of member states to take action in certain areas that are covered by the EU treaties, but without requiring every other member state to join in.
	The provisions for enhanced co-operation already exist; they were introduced in the Amsterdam Treaty. However, they have not yet been used. Nice makes them easier to use for those who want to use them, while strengthening the safeguards for those who do not. That is a sensible move and one we believe is necessary to prepare for the enlargement of the Union that we want. So we welcome it.
	It is not about building some sort of two-speed Europe or a hard core of states preventing others from joining in. My right honourable friend the Prime Minister said in his speech in Warsaw last year that enhanced co-operation is an instrument to strengthen the Union from within, not an instrument of exclusion. The safeguards that we built it at Nice will prevent that.
	The treaty makes clear that enhanced co-operation must be a last resort, not the rule. As many member states as possible will be encouraged to join in. Those wanting to join an existing enhanced co-operation later will be given every opportunity to do so. Enhanced co-operation must respect the rights of those not participating. It must not undermine the single market, constitute a barrier to trade or distort competition. Actions under enhanced co-operation will not form part of the acquis or basic rules of the EU, so neither existing nor new members will be required to take part.
	It was right to strengthen those safeguards, and, as we did at Nice, to amend the procedures so that, providing the safeguards are respected, no one state can veto a proposal for enhanced co-operation. The exception—I stress this point for the noble Lord, Lord Howell of Guildford—is common foreign and security policy. Nice introduces for the first time the possibility of enhanced co-operation in CFSP, which we support. But we have retained the veto there. The so-called emergency brake stays for CFSP and not elsewhere for the good reason that policy decisions in CFSP are taken unanimously.
	As the Opposition have tabled only one amendment on the procedures for those outside CFSP enhanced co-operation to join it, I take it that they do not object to the principle of enhanced co-operation itself. I welcome that, if that is the case. Perhaps the Opposition believe, as the Government do, that enhanced co-operation is an opportunity, not a threat. In a number of scenarios, Britain may want to join actively in areas of enhanced co-operation. In the Community pillar, for example, the UK may want to join an initiative on scientific research that some other states may not want to join. The UK may want to participate in an initiative to improve transport links between the UK and neighbouring member states.
	In CFSP, the United Kingdom may want to join other interested member states to implement a common EU policy—for example, in Africa, where some EU partners, like ourselves, have historic links—on managing monitors. That is an entirely understandable position. In justice and home affairs, we can imagine the UK joining a group of member states to agree tough action on an issue that directly affects only a small group of us—for example, drugs trafficking in the North Sea. All in all, the improved enhanced co-operation arrangements will be good for Britain and are a valuable feature of the treaty. We strongly support them.

Lord Watson of Richmond: Surely, in the background to the article as drafted, is a reminder of the fundamental purpose of the Treaty of Nice. The treaty is tied to the enlargement of the Community; it is the basic facilitator. It is impossible to conceive the enlarged Community without the formalisation of flexibility—we could call it the institutionalisation of pragmatism—which Article 27 is all about. The article represents a practical way forward; it makes a lot of sense. It is good for Britain and good for the Community.

Baroness Park of Monmouth: Perhaps I may ask the Minister for clarification. Article 27b states:
	"Enhanced cooperation . . . shall relate to implementation of a joint action or a common position."
	Article 27e appears to support that. Proposed Article 24.3 states:
	"When the agreement is envisaged in order to implement a joint action or common position, the Council shall act by a qualified majority, in accordance with Article 23(2)."
	Does that mean that QMV can and will be used in the context of enhanced co-operation when the issue is foreign policy? I know that the article excludes military and defence policy.

Lord Stoddart of Swindon: Perhaps I may ask the Minister a couple of questions. A while ago, I read a book by Sir Richard Body called Europe of Many Circles. Is enhanced co-operation in line with the thesis of that book? He proposed that instead of having a Europe with the acquis communautaire, and what have you, we should have a much looser sort of Europe where people would co-operate in the things that they believed to be right for them and which benefited their own country. Is the enhanced co-operation system progress towards that goal, or is it something quite different?
	My other question concerns something that is not clear to me; perhaps I am not reading the treaty properly. Once enhanced co-operation is made, does it become part of the acquis communautaire, or can people resign from it? In other words, can they co-operate for so long and then say, "We have had enough of this. It has suited our purpose; we would like to resign from this piece of enhanced co-operation"? Or, once they have made the agreement, is it for all time? I should be interested to know the answer.

Baroness Symons of Vernham Dean: As I understand it, enhanced co-operation does not become part of the acquis. I hope that my noble friend will forgive me, but it is difficult for me to tell him whether or not I agree with something in a book that I have not read. Perhaps I can study what he has said, and if there is anything I can usefully add, I shall write to him. I am bound to say that there are quite a few books that I have not read; although I have read one or two. I cannot comment on whether I agree with the central thesis of something that I have not had the opportunity to study.
	On the question that the noble Baroness raises, where we require unanimity in setting a policy, we would have a veto. Her question relates to CFSP policies. As I understand it—I shall write to her if I am wrong—where we require unanimity in setting the policy, we would be able to exercise a veto.

Baroness Park of Monmouth: May I suggest to the Minister that she read Mr Solano's paper on common strategies, which sets out the intention?

Baroness Symons of Vernham Dean: As always, the noble Baroness is a font of good advice. I shall take her advice and write to her accordingly.

Lord Pearson of Rannoch: Will the Minister clarify that the flexibility that has been sewn into the treaty with these clauses is yet again a one-way flexibility? In other words, as I understand it, if eight or more countries wish to follow the path of enhanced co-operation, they may do so. I think that I am right in saying—perhaps the Minister will confirm this—that the rest of us have to pay for it, apart from any defence implications of the enhanced co-operation.
	Did the United Kingdom get anything back for the concession of allowing those eight or more member states to move towards enhanced co-operation? Did we, for instance, ask for our fish back from the common fisheries policy? Did we say to the others, "Well, you can have your enhanced co-operation if you want, but we want our fish back."? Or did we just let them have it, agree to pay for it and get nothing back in return?
	Above all, is the Minister really saying that those eight can move forward to their enhanced co-operation but we cannot move backwards at all? That is a slightly rhetorical question—I imagine that is the way because it always is with the European Union—but perhaps the Minister would be good enough to confirm it.

Baroness Symons of Vernham Dean: I am afraid that the noble Lord and I start from such a fundamentally different premise in how we regard these issues that I am unable to answer the question of what price we made the other member states pay for something that we wanted.
	The noble Lord, Lord Pearson, should not be under any illusion. The United Kingdom Government support enhanced co-operation. We do not support it in a half-hearted way; we do not support it in such a way as to believe that it should not be done or that somebody had better give us something back for it. That is not the nature of the United Kingdom's attitude to these issues. The premise of the noble Lord's argument in asking what we got for it, therefore, is fundamentally flawed.
	However, any use of enhanced co-operation has to satisfy a series of conditions. It must be a last resort. It must involve at least eight member states. It must respect the acquis. It must not damage the single market. It must be open to all member states, including those who want to join later. Some of those conditions were, of course, in the Amsterdam treaty, but some are new provisions. We believe them to be important safeguards and that they should be supported.
	I am sorry not to be able to tell the noble Lord that all sorts of splendid things came in as a rebalancing for what he clearly believes to be a deficit to the United Kingdom. No such deficit is recognised by the UK Government.

Lord Biffen: In order to spare the noble Baroness further reading, I can assure her that all the conditions she attached to enhanced co-operation would make it wholly unacceptable to Sir Richard Body.

Lord Pearson of Rannoch: So the noble Baroness is saying that this is yet again one-way traffic; nothing came back our way. There is no provision in the treaty to recover any of the powers we have given to the European Union. I believe that is what the noble Baroness is saying, but I should like it on the record.

Baroness Symons of Vernham Dean: I am not saying that. I do not accept the premise of the noble Lord's argument. The noble Lord should not try to put words into my mouth, tempting though that may be. I am tempted sometimes to do it but I try very hard to restrain myself. The fact is that this was something the United Kingdom Government wanted and supported. There was no question of there being a price to pay.

Lord Stoddart of Swindon: I am still a little worried about this. The enhanced co-operation must involve at least eight member states. My noble friend said that countries which decide that they no longer want to be part of the enhanced co-operation can resign from it. If eight countries are involved in a measure of enhanced co-operation and one resigns, that will leave only seven. Does that mean that the whole of the enhanced co-operation falls?

Baroness Symons of Vernham Dean: The safeguards state that there should be at least eight member states. That is what is in the provisions. It follows, therefore, that there must be at least eight member states.

Lord Howell of Guildford: This debate has taken a rather unsatisfactory turn. I was of the clear impression that before the Nice treaty the Government were not loud in their view that they were going to say goodbye to the veto in this area and embrace qualified majority voting in relation to Article 27e and all sorts of procedural questions as in Article 23, subparagraph (3), which was also referred to in Article 27e. The noble Baroness now says that that was something they were always prepared to put aside because they see benefits for the United Kingdom in enhanced co-operation by qualified majority voting.
	It may mean that I am approaching this matter from a different angle to the noble Baroness, but I am not sure that I do see such benefits and I am not sure that other Members of the Committee do either. We favour enhanced co-operation when it is flexible and is applied lightly in relation to specific issues. Indeed, the pattern of the future European Union will move further and further away from the heavy hand of uniformity and standardisation. That is inevitable and is thoroughly beneficial for the diversity of Europe which my noble friend Lord Willoughby de Broke was praising earlier.
	But when enhanced co-operation is achieved by majority, leaving others behind, it is a much heavier concept. It implies integration and commitments in areas which may be extremely damaging to the diversity and flexibility of Europe as a whole.
	I was unimpressed by the comments made by the noble Baroness, Lady Symons, and not at all happy that I should simply withdraw the amendment and nod through support for this proposition. Throwing away this veto is throwing away something which could have been used. Other countries bargain briskly and we can bargain in a friendly way; in a pro-European way; in a communautaire way. But this is something that should have been done less casually and with more focus on the flexibility we need for the kind of Europe that I believe the Prime Minister favoured in part of his Warsaw speech—some of it mentioned "superpowers", with which we do not agree. It is something most of us favour.
	An increasing number of advocates of European Unity in applicant states undoubtedly favour a more flexible pattern for the Europe they long to join. I recently spent a weekend in Budapest with leaders from three of the major applicant states and I have to tell the noble Baroness that their constant emphasis was on flexibility and not on more qualified majority voting or abandonment of the right, in the last resort—one never wants to see it used—to say no to a specific endeavour by another group of eight states.
	This is not a happy proposition and not one that I can recommend the Committee to support. Therefore I commend Amendment No. 11.

On Question, Whether the said amendment (No. 11) shall be agreed to?
	Their Lordships divided: Contents, 58; Not-Contents, 121.

Resolved in the negative, and amendment disagreed to accordingly.
	[Amendments Nos. 12 to 14 not moved.]

Lord Howell of Guildford: moved Amendment No. 15:
	Page 1, line 9, after "10," insert "other than Article 2, paragraph 9, subsection 1, revising Article 137 of the Treaty establishing the European Community,"

Lord Howell of Guildford: We now turn away from the Treaty on European Union to deal with the treaty establishing the European Communities. For those who, like me, sometimes feel bewildered by the colossal volume of paper and the need to find one's way around between the different treaties, the excellent publication, The Treaty of Nice in perspective, Volume 2, guides us to the appropriate article; that is Article 137 of the treaties establishing the European Communities.
	This is an area in which the phrase "Community activism" comes to mind. A long list of the involvements with which the Community institutions want to go ahead already existed in the previous treaties. The phrase used is:
	"the Community shall support and complement the activities of the Member States in the following fields".
	However, there have been additions to the long list. I pause for a moment on the word "complement". Co-ordination is immensely valuable. That applies, for instance, in a field which is not covered by the amendment, but which is important; that is, overseas aid. Everyone wants co-ordination and concertation. That makes enormous sense in the modern world.
	Then comes the thought that there should be complementary activity over and above the co-ordination of member states' activities; a new layer of operations and programmes and, inevitably, transfer of resources, which adds to the complexity of the European effort without necessarily improving it. Indeed, in some areas we have sad evidence, which we shall come to when we debate matters such as the audit procedures of the European Union, that these additional and complementary layers of activity breed a great deal of expenditure and not, alas, effective results. Remote and ineffectual are the adjectives that come to mind. I believe that originally they were applied to dons, but often they are applied to some of these programmes that merely add to the existing efforts of the member states.
	It would tire noble Lords for me to go over the matters covered by previous treaties, but they are there. Let us look at the additions to Article 137 that the Nice Treaty introduces and that this legislation introduces into our law. Paragraph (j) is an admirable aim,
	"the combating of social exclusion".
	We all want to combat social exclusion, but our success in many areas is limited. In our own country, let alone in the wider world, there are still areas of intolerable poverty and deprivation and conditions that should not exist in the 21st century. We are all guilty and the finger of shame should point at us all.
	I would not recommend some of the policies of recent years aimed at combating social exclusion but I believe that some of the policies that were tried in the 1970s and 1980s should have been pushed to a more successful conclusion. Either way, one has to decide whether such matters are best handled and complemented at a national level or at a European institution level. On these Benches the instinct is for the former. We believe that such matters are best handled at a national level.
	That kind of language will be familiar to your Lordships in relation to the old argument about subsidiarity. There was to be a system by which someone—it turned out to be the European institutions themselves, in particular the Commission—was to decide whether such matters were best handled at a national level or at a Community level. Needless to say, in almost every case, except for one or two very small ones, the decision was taken that such matters were best handled at a Community level.
	The subsidiarity saga has not really taken off and has not worked well at all in this area or in any other. We now see that this intimate aspect of policy, where policy effects must be geared sensitively to the social conditions, to the working conditions, to the life conditions and to the family conditions of individual citizens in individual communities and parishes, is a matter that the great community of 15 nations will support and complement. I wonder whether the philosophy behind that is at all modern.
	It appears to me that it is a pattern that belongs to the world of yesterday, the world of centralisation, where big is better, a world in which Aristotle warned that there must be a limit to the size of a state and to the size of human organisations. I believe that that is true. I wonder whether attempting to grapple with social exclusion at the level of the European Community is a sensible addition to the agenda with which the senior officials of the European Community should be concerned; for example, the making of Europe-wide rules and regulations where they have value to add rather than in areas where they just add more organisation and more cost.
	Another point on the list is the modernisation of social protection systems without prejudice to point (c), which is,
	"social security and social protection of workers".
	That was there already. Again, this marks a substantial advance into detailed national and domestic concerns. Even if noble Lords do not like the word "national", there are concerns that are best administered on the shop floor or in the home or the workplace, but here they are added to the list. Other aspects of Article 137 make us feel that the activism, the desire to become involved, has become more important than the achievement of effective results.
	Those are my main points in relation to this article, but there are others that noble Lords may want to develop. This is a good and a worrying example, not of building a great common market, not even of building European unity, but of taking to the centre activities, energies, involvement and resources that should be administered through the nation or member states. Instead, of co-ordinating and making rules and regulations, this is the genesis or the seed of programmes that will not be effective. They will probably stand in the way of the dedicated work that is being carried out in nation states to overcome the social exclusion of which there is still too much in our land. I beg to move.

Lord Willoughby de Broke: I rise to support the amendment. Article 137 has nothing to do with enlargement; most of the treaty has nothing to do with enlargement. It is contrary to what has been repeatedly stated elsewhere that it will help businesses. It will not help the applicant countries. As my noble friend said, this is a centralising part of the treaty: working conditions, social security, social protection, protection of workers, information and consultation of workers. No one has anything against the consultation of workers, but surely that is a matter for subsidiarity and a matter for the firms involved, and certainly not for the Council of Ministers or the Commission.
	Perhaps I can draw the Committees' attention to paragraph 2(b) of Article 137, which states:
	"Such directives shall avoid imposing administrative, financial and legal constraints in a way which would hold back the creation and development of small and medium-sized undertakings".
	As we know, small and medium-sized undertakings create the most employment and they are the engine of commercial success. It appears to me that what is stated here is the direct opposite of what happens. A recent example was the European Parliament amending a proposal that affected businesses of 50 employees or more. Such businesses had to have employee consultation on all kinds of matters that could have been commercially sensitive and that has been changed to businesses employing 20 or more people. That will affect a whole raft of businesses. They will have to operate like ICI or Marconi, with a single department to deal with co-operation and information with the employees. That really is not suitable for small firms with 20 employees.
	The rhetoric is that those directives will not affect the creation and the development of the small and medium-sized undertakings, but I am afraid that they will. To say that they do not is rubbish. The way in which this article is phrased directly affects small and medium-sized enterprises to their extreme detriment. Many of the provisions are anti-business and anti-enterprise.
	The applicant countries will ask, "Why is this provision here? Why are we being challenged like this? Why is it becoming more difficult, rather than easier for us to join in the joys of the single market?". There is a whole raft of measures, one of which has 12 sub-headings and so on. It does not appear to be helpful to enlargement and it is certainly not helpful in making small and medium-sized enterprises more competitive, which is part of the objective.
	I hope that my noble friend will decide to divide on the amendment but if he does not perhaps he will return to it at a later stage. I support his amendment.

Lord Biffen: The noble Lord, Lord Willoughby de Broke, made a powerful argument about some of the detailed implications of the provision. I want to consider it in the broader sense in which it was introduced by my noble friend on the Front Bench. Particular emphasis was placed on the general terms of social exclusion. Most of us who have been in politics have lived with social exclusion. We know of the tremendous challenges it lays down and that often the fashions of one decade are replaced by subsequent experiences. It is not an easy subject but, none the less, it is a challenging and continuing one.
	What worries me about such legislation is that it contains no implication of the policies which might be designed to counter social exclusion. It merely places social exclusion on the statute book. I believe other circumstances are to be prayed in aid; for instance, the circumstances of the Community budget. As a result of enlargement—and, after all, all these topics should be considered in that context—we shall see an increasing demand in both regional and social expenditure upon the budget. I believe that with economies so disparate within the disciplines of the single currency, there will be great demands within the various countries as they encounter some of the disadvantages within those disciplines.
	Therefore, in this debate we have the opportunity to place on record—or not to do so—the general term "social exclusion" which will be prayed in aid by all those who want to drive the enlarged European Union into a greater and greater spending authority; and by implication, although concealed by the methods of tax raising, a tax-raising authority.
	I believe that that is precisely the wrong way in which we should be seeking to direct an enlarged European Union. It should be an argument for decentralisation and disaggregation of government involvement rather than its accentuation.

Lord Stoddart of Swindon: I shall speak first to Amendment No. 15 and then to my Amendment No. 17. I support the amendment. Bearing in mind the differences in working practices, in history and in many other areas, I find it difficult to understand how 27 countries will be able to harmonise their social provision. In any event, I do not believe that it is desirable. The nation states, whether Britain, France or whichever, which have been built up over a long period of time have arrangements which suit them and one way or the other they have a form of government which gives them the consent of the people for what they are doing or intend to do. My fear is that what we have here is "entryism"; that although there are provisions which give protection to the nation states to do what they want in basic terms, eventually that will grow and grow and the powers will be further increased to the detriment of the power of the nation states.
	Let us take as an example our own country. We now have a Labour Government with a huge majority. They are able in social provision to do virtually what they like. I believe that that is the proper way forward. The Government have been elected with a good majority on a manifesto which made it clear to the people of this country what they wanted to do, what they intended to do and the limits of what they would do if they were entrusted with that term of office.
	That is the way it should be. That is the way politics and the provision of social and other services works in this country. I do not want it altered. There is a danger—and people must be warned of it—that provisions of this kind will prevent elected governments and parliaments in this country from doing what they and their electors want to do. That is what concerns me.
	There are safeguards in place but eventually they may well be removed. We would then find ourselves either making more social provision than we thought we could afford or less provision than we could afford because we were constrained by other countries whose leaders and parliaments derived no power from our people and were not responsible to them in any way.
	It is increasingly becoming the case that wherever there is qualified majority voting, the parliaments and electorates of the nations are being sidelined. Decisions are being taken not by Parliament by majority but by a majority of people who have not been elected by the British people and who are not responsible to them. The Bill is a further step towards that undesirable position.
	I now turn to Amendment No. 17, which deals with the setting up of a social protection committee. It reminds me of the French Revolution. It is yet another Euro-quango which is being set up with the aim of promoting co-operation between member states. Its remit is wide, so let us look at it:
	"The Council, after consulting the European Parliament, shall establish a Social Protection Committee with advisory status to promote cooperation on social protection policies between Member States and with the Commission. The task of the Commission shall be: to monitor the social situation and development of social protection policies in the Member States of the Community; to promote exchanges of information, experience and good practice between member states with the Commission; without prejudice to Article 207, to prepare reports, formulate opinions or undertake other work within its fields of competence, at the request of either the Council or the Commission or on its own initiative".
	It then states:
	"In fulfilling its mandate, the Committee shall establish appropriate contacts with management and labour",
	In the first instance, the membership of the committee will be about 56, with 10 new members. I have no doubt that when the protection committee gets going it will range further and wider than envisaged in that article. It will drive towards the harmonisation of social systems and social provision. As I explained previously, that may not always suit us. Whatever party is in power, it may be detrimental to the policies that it wants to pursue. The provision could therefore lead to more financial resources—and it is true that it could lead to less.
	Ten countries from the east are joining and many of them are poor and have a low standard of living. There could be a call for a large amount of extra finance. As we know, Mr Prodi and the European Parliament want direct taxation at the behest of the Parliament and the Commission. We really have to look ahead to discover what this social protection committee wants to do. As I say, there is already a call for an EU-wide tax. I have no doubt that the committee will do its best to promote that because it will enable it to do what it wishes.
	There is one final point I wish to make as regards the contacts between management and unions. What will they be about? Will they be on the basis of negotiation? I am glad that we have now introduced a minimum wage. Will that be one of the kinds of things that will be discussed by the social protection committee? If so, I believe that that would be bad. My background is in the trade union movement and I believe that the right people to negotiate wages, conditions, salaries and the minimum wage are the trade unions as they represent the working people of this country. I do not want to see the intrusion of government of any sort into the area of collective bargaining.
	I hope that Members of the Committee will understand the dangers that these two particular provisions present because increasingly and when each new treaty is signed, there is a passing of power from this Parliament or other such institutions to the institutions of the Community, which are less democratic, which are secretive and which could do much harm. I implore Members of the Committee to be very careful about what they are doing.

Lord Harrison: I rise briefly to challenge some of the points made by the noble Lord, Lord Willoughby de Broke. I agree with him that small businesses are at the heart of Europe and the single market. However, I wholly disagree with him that the implementation of the Treaty of Nice will be bad for business in Europe and the United Kingdom and in particular for small businesses. That is what he says in this amendment. I believe that if he reads what the treaty provides, albeit in a very modest way, he will see that the extension of qualified majority voting will actually help small businesses, especially as regards red tape by challenging it, and in the furtherance of research and development. So I hope that he will read again the Treaty of Nice and what is proposed because I believe that he will find that small businesses and business as a whole will be helped by the implementation of the treaty.

Lord Willoughby de Broke: I am grateful to the noble Lord for reminding me to look back at the treaty. I wonder where he gets his information, because all the small businesses I have been involved with, whether in my own personal experience or through the Federation of Small Businesses, do nothing but complain about the increasing amount of red tape from Europe. The European Parliament has just compounded that felony quite recently, as I explained in my recent comments and at Second Reading. Therefore, I do not know how the noble Lord can possibly say that the European Union is making life easier for small businesses when it is perfectly plain that it is not—and that it is doing the opposite.

Lord Harrison: Perhaps I may quickly trespass on the time of the Committee in two specific ways. First, the ambition of the single market is to introduce one set of regulations, replacing the 15 different sets which exist now. Secondly and specifically, in this treaty there are references to small businesses where the use of qualified majority voting will promote programmes in favour of helping small businesses. I encourage the noble Lord to look at that and to gain sustenance from seeing it in practice.

Lord Pearson of Rannoch: Does the noble Lord, Lord Harrison, agree that the harmonisation to which he refers and which is to take place throughout the European Union is harmonisation which will increase regulation in our economy up to the level of that in, shall we say, the German and other economies and thus lose us the competitive edge which we have enjoyed for so long—although it is being rapidly diminished by clauses such as this one in the Treaty of Rome?
	Is the noble Lord aware that at a convention the Federation of Small Businesses has just voted to leave the European Union altogether, largely on the point of the massive over-regulation which is strangling the small businesses? I cannot see how the noble Lord can maintain his hypothesis.

Lord Willoughby de Broke: I support the amendment tabled by the noble Lord, Lord Stoddart of Swindon. I ask the Minister to explain why this social protection committee is necessary at all. What is it going to do? The noble Lord, Lord Stoddart, is quite right. Once the committee has been established, it will want to work. It will have minutes, a budget, and it will want to be paid. It will be busy.
	It is to monitor the social situation and the development of a social protection policy. It is to promote the exchange of information, experience and good practice. But there are plenty of bodies already in existence which do that. Why do we need another massive committee with 58 members? Why do we need it to prepare reports, formulate opinions and undertake other work within its field of competence? Surely there are enough committees in the European Union already and at national level to do these things without establishing another body. Another enormous committee would simply add to the bureaucracy that we have just been talking about. It is to do a job which is not necessary. Can the noble Lord explain why anyone believes that a social protection committee is remotely necessary for enlargement, for example?

Lord McIntosh of Haringey: I am sorry that the noble Lord, Lord Howell, should begin by thinking that these provisions are remote and ineffectual. I remind him that when Hilaire Belloc used that phrase in defence of G K Chesterton he was attacking G G Coulson who was a far more distinguished historian and philospher than G K Chesterton; I am not saying that he was a better poet or novelist. The noble Lord should beware whom he attacks; but it was a splendid piece of invective.
	Even those who support Articles 137 and 144 will be somewhat disappointed if they take too seriously what has been said in this debate. Article 137 makes very few changes of substance. Almost all of it is a reordering of the Amsterdam Treaty. For example, voting by unanimity was retained in the following key areas: social security, the social protection of workers, the protection of workers where their employment contracts are terminated, representation and collective defence of the interests of workers and employers, and with regard to conditions of employment for third country nationals legally residing in the Community.
	One new provision is the addition of a reference to the modernisation of social protection systems which can take place by QMV. But action in that area is limited to the adoption of measures designed to encourage co-operation between member states, and it does not include legislation. Indeed, I say to the noble Lords, Lord Stoddart and Lord Willoughby de Broke, that if they read Article 137(2)(a) they will see that the measures specifically exclude any harmonisation of the laws and regulations of the member states.
	The action plans, which are along the same lines as the social exclusion action plans, add impetus to member states' moves to combat social exclusion. Pay, the right of association—apparently this is the concern of my noble friend Lord Stoddart—and the right to strike and impose lockouts continue to be excluded from the provisions of Article 137.
	Article 137(4) is amended to make clear that any proposals agreed must not affect the rights of member states to define the fundamental principles of their social security systems and must not significantly affect the financial equilibrium of national systems, which is an important and welcome clarification.
	Amendment No. 17 tabled by my noble friend Lord Stoddart refers to the social protection committee which he fears will grow and spread its tentacles all over the European Union. I have to tell my noble friend that it already exists. It was set up to undertake work in two areas identified by the European Council in Lisbon. That committee has existed since December last year and is run on the basis of Article 202. All that happens now is that it is given more specific existence. My noble friend has correctly quoted the three main tasks: monitoring social protection policies in member states and the Union; facilitating exchanges of information and good practice; and preparing an annual report on social protection which highlights key policy developments.
	I do not believe that either my noble friend Lord Stoddart or the noble Lord, Lord Willoughby, understands that the establishment of a committee is a move away from a too prescriptive legislative agenda to a useful mechanism to facilitate exchange of information, experience and good practice; in other words, it is in the reverse direction from that which the speakers to this amendment appear to believe it is going.
	We support greater exchange of information to learn from each other and ensure that we do more to help people into work and, at the same time, provide greater security for those in work. If social policy in the sense of Articles 137 and 144 is an illegitimate subject for the Treaty of Nice, which appears to be suggested, it has been an illegitimate subject for a very long time. We profoundly disagree that these matters should be excluded from the treaty.

Lord Howell of Guildford: One can hardly disagree with much of the aims and policy objectives which the noble Lord has just outlined. It is sensible that these policies should be pursued within nation states and that all kinds of co-ordination should take place. What is left hanging in the air—the case has not been made for it—is why it is necessary to put Article 137 into a treaty, let alone that it should be upgraded under the Treaty of Nice, if it is all so delicate that it hardly touches anything or intrudes into any national policies. This is to misuse international treaties and the legislation which flows from them in far too heavy-handed a way. A tolerant Union which binds Europe together is not made of this material. One cannot bind people together by forcing them together. One cannot bind Europe together by constant activism and intrusion, however light it is supposed to be, into these matters. That is my view on Amendment No. 15 to revise Article 137.
	The noble Lord, Lord Stoddart, will speak to his amendment in a moment. However, I have some sympathy with him and my noble friends who have questioned the need for yet another committee. Not only are committees very often fateful affairs, particularly at international and supranational level, but this matter completely fails to understand the way in which the Union is evolving. The Union is now moving in the direction of agencies and soft legislation through national parliaments. The old pattern of a hierarchy of committees at the centre handing down the law has vanished. That pattern belongs to yesterday's Europe, not the systems that are now evolving—whether or not we like them—and certainly not the flexible Europe on which comment has been made in earlier amendments.
	As far as concerns Amendment No. 15, I am left very uneasy about the implications and thinking behind it as outlined by the Minister. However, it is an hour when no doubt other things are in the Committee's mind. I shall return to these issues later, but for the moment I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendment No. 16 not moved.]

Lord Stoddart of Swindon: had given notice of his intention to move Amendment No. 17:
	Page 1, line 9, after "10," insert "other than Article 2, paragraph 11,"

Lord Stoddart of Swindon: I should like to say a few words in reply to the Minister. I understand what the Minister has said and I shall consider it. If it is true that we are moving away from formality I am very happy. However, it remains my impression that we are moving away from informality to formality. I give notice that I may bring this matter before your Lordships again at Report stage, but I shall not move Amendment No. 17.

[Amendment No. 17 not moved.]

Lord Grocott: I beg to move that the House do now resume. In moving this Motion, I suggest that the Committee stage begin again not before 8.57 p.m.

Moved accordingly, and, on Question, Motion agreed to.
	House resumed.

Misuse of Drugs Act 1971 (Modification) Order 2001

Lord Rooker: rose to move, That the draft order laid before the House on 24th October be approved [7th Report from the Joint Committee].

Lord Rooker: My Lords, in my view, the provisions of this order are compatible with convention rights. The purpose of the order is to bring 36 previously uncontrolled ecstasy-type substances under the controls of the Misuse of Drugs Act 1971. As required by that Act, the Advisory Council on the Misuse of Drugs has considered the misuse potential of these drugs and recommended that they be brought under the Act's controls.
	The Government's aim is to prevent these ecstasy analogues being launched onto the illicit drugs market. The order will prohibit the production and supply of the substances on the illicit drugs market and provide the enforcement agencies with the powers they need to stem the trade in these drugs. Thirty-five of the substances have no recognised therapeutic uses. The 36th substance—a-methylphenethylhydroxylamine (henceforth referred to as "a-m")—is used medicinally but is not manufactured as a medicine in the UK.
	The order proposes that 35 of the substances be added to the list of controlled drugs specified in Class A of Schedule 2 to the 1971 Act. The 36th substance, a-m, will be added to the list of controlled drugs specified in Class B. In accordance with usual practice, we have consulted the organisations which represent the enforcement agencies, the medical professions and the pharmaceutical industry about the changes. None has raised any objections to the proposals.
	If the order is approved we aim to bring it, together with the relevant amended regulations, into force on 1st February 2002. I commend the changes proposed in the order. I beg to move.
	Moved, That the draft order laid before the House on 24th October be approved [7th Report from the Joint Committee].—(Lord Rooker.)

Lord Phillips of Sudbury: My Lords, we on these Benches entirely support the order. All must cherish this particular order: it is stuff with which to paper one's lavatory at home. However, we accept that it is very important. For the consideration of the Government, the only point I raise, which was debated in the other place, is that one of the drugs on the list was accidentally omitted on the previous occasion. I also understand that these are all artificial drugs. That is to say, they are compounds.
	The world of drugs moves at a tremendous rate. New types of ecstasy-related drugs are created all the time. One wonders whether there is a procedure to bring these newly created drugs back to the House more swiftly than has taken place in this case. The drug was left off three years ago. I raise the question in a spirit of constructiveness. Other than that, we support the Motion.

Lord Rooker: My Lords, in answer to the point raised by the noble Lord, Lord Phillips, these are alternative drugs to ecstasy which are designed to evade the drug controls. They are designer drugs.
	The noble Lord's point about legislation is extremely valid. It will always lag behind the illicit traders. I shall ask for consideration to be given to his suggestion in order to avoid Ministers, or anyone, in future having to read out some of the drug names.

On Question, Motion agreed to.

Criminal Justice (International Co-operation) Act 1990 (Modification) Order 2001

Co-operation) Act 1990 (Modification) Order 2001

Lord Rooker: rose to move, That the draft order laid before the House on 24th October be approved [7th Report from the Joint Committee].

Lord Rooker: My Lords, in my view the provisions of the order are compatible with convention rights.
	The purpose of the order is to add norephedrine to the substances listed under Schedule 2 to the Criminal Justice (International Co-operation) Act 1990. That will enable the United Kingdom to comply with a decision taken by the UN Commission on Narcotic Drugs to bring norephedrine under the control of the 1988 UN Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances.
	The order will make it an offence to manufacture or supply norephedrine knowing or suspecting that it is to be used in the illegal manufacture of a controlled drug. It will be punishable by up to six months' imprisonment on summary conviction and up to 14 years on indictment and/or a fine.
	If the order is approved, we aim to bring it into force, together with the relevant amendment regulations, on 12th December 2001. I commend the order to the House.
	Moved, That the draft order laid before the House on 24th October be approved [7th Report from the Joint Committee].—(Lord Rooker.)

On Question, Motion agreed to.

Regulation of Investigatory Powers (Technical Advisory Board) Order 2001

Lord Rooker: rose to move, That the draft order laid before the House on 17th October be approved [6th Report from the Joint Committee].

Lord Rooker: My Lords, I lay before the House the order under Section 13 of the Regulation of Investigatory Powers Act 2000 which requires affirmative approval. The technical advisory board's function is to act as an appeals body should a communication service provider believe it is being asked to make unreasonable efforts to maintain an interception capability, and to act as a point of consultation on the order under Section 12 which in due course will define the scope of this capability.
	The creation of the technical advisory board was supported by the Opposition parties during the passage through Parliament of the Regulation of Investigatory Powers Act. Therefore, I hope that I do not need to explain it in further detail, other than to say that the technical advisory board will be an advisory non-departmental body. It will be run in accordance with the Cabinet Office guidelines while the recruitment of members will follow the Commission for Public Appointments' code of practice. Our intention is to recruit the chair first, so that he or she can then assist with the selection of the members.
	This instrument is compatible with the ECHR. It is a straightforward order which gives effect to the will of Parliament. I commend the order to the House.
	Moved, That the draft order laid before the House on 17th October be approved [6th Report from the Joint Committee]—(Lord Rooker.)

Lord Dixon-Smith: My Lords, I hope that the Minister will forgive me if I ask one or two technical questions. This matter is relatively straightforward in some ways. The European Council Directive 98/34/EC, amended by Directive 98/48/EC, creates an obligation on member states to notify draft technical regulations relating to manufactured products, agricultural products and information society services to the European Community before national adoption.
	The technical question is whether that has been done. It may seem that the creation of a technical advisory board is not something that the European Community would be in the least concerned about. I have some sympathy with that position. The difficulty is that the European Council directive does not specify what should and what should not be included. We are stepping on to dangerously thin ice if we begin to decide to comply with these directives in some matters which we think are relevant and in other matters which we think are not. So I believe that that is a proper question to ask.
	It would also be interesting to know how the law enforcement membership of the board will be selected, and, more significantly, how the communications industry members will be selected. That is relevant information to which this House should be entitled.
	There have been wildly differing estimates of what the directive will cost the industry as it is implemented. Does the Minister have any further information on whether the Government's estimates of costs of the order of £20 million are correct or whether the industry's estimates—I entirely agree that industry tends to overestimate costs in these circumstances—are more realistic?
	The final point is that the EU is moving slowly towards greater privacy and protection of individuals and what they say and do to each other. One wonders whether the powers that this advisory board is directed to controlling, which involve a greater intrusion into the privacy of communication, are consistent with the spirit of EU law as it is now developing.

Lord Phillips of Sudbury: My Lords, it was interesting to hear the noble Lord, Lord Dixon-Smith, say that this is a straightforward matter. I seem to remember nights and nights of battling over this question. The good Lord Bassam, who sits next to the good Lord Rooker, is nodding his head. We must acknowledge a little gratitude to the Government for at last admitting that this was a necessary board. It will have very important work to do.
	I have two questions to add to those raised by the noble Lord, Lord Dixon-Smith. The first is whether the Minister can give any indication of the kind of person who will be looked for as chair of the technical advisory board. It will obviously be a very important position.
	The second question is whether or not the Government have in mind, even now, to use the provisions of Section 13(2)(c) to appoint others to the board. That is a power which the Secretary of State retained. On these Benches we had in mind the possibility that there might be, in addition to the phalanxes of industry on the one hand and officialdom on the other, a representative of the independent technical world or the civil liberties world. This issue is thick with civil libertarian issues. They also come into play under the anti-terrorism Bill. Perhaps the Minister can give us some guidance on both those points.

Lord Rooker: My Lords, this fantastic brief does not enable me to answer the first point of the noble Lord, Lord Dixon-Smith. He has me "bang to rights" on the EU.
	With regard to the costs aspects, we stick to the £20 million that the noble Lord mentioned. We are considering policy options at the moment. Obviously, we have had much information from service providers and manufacturers.
	During the passage of the anti-terrorism Bill, when this issue is relevant in terms of the data holding aspect, I shall ensure that I get the necessary answers on the cost.
	Regarding the appointments, we propose that the technical advisory board should consist of six people able to represent the interests of industry, six people able to represent the interests of the intercepting agencies and a neutral chair.
	As I have said, the appointments must conform with the usual conduct of selection set out by the Commission for Public Appointments, by which we shall abide. We wish to appoint the neutral chair first. It is likely that the identity of the chairman or chairwoman will be announced in response to a Parliamentary Question.
	We are undecided about industry representatives. Some potential members have stated that they would be willing to participate only if their involvement is not made public. This is a sensitive issue and one that will require further examination.
	I regret to say that I do not have the answers to the remainder of the questions that have been put to me. I shall write to both noble Lords as quickly as possible.

Lord Phillips of Sudbury: My Lords, I do not wish to prolong discussion on the order, but I should like to ask the Minister one further question. When he responds to the question I put to him on the cost of provision of the mark one black boxes, perhaps he will add a paragraph covering the mark two black boxes. The industry is fast-moving and I understand that concerns have been expressed about the second generation black boxes and the Government's attitude as regards making a contribution towards the cost.

Lord Rooker: My Lords, any further information that I can obtain that can be made available with regard to the points he has put to me will be included in my written response.

On Question, Motion agreed to.

Fishing Vessels (Decommissioning) Scheme 2001

Lord Whitty: rose to move, That the scheme laid before the House on 15th October be approved [6th Report from the Joint Committee].

Lord Whitty: My Lords, under this scheme, we will be making available £6 million in decommissioning grants to English fishermen. I should like briefly to highlight the key aspects of the scheme. These have been the subject of full consideration with industry representatives.
	Applications are now open to over 10-metre vessels with a category A licence and at least 75 recorded days at sea in each of the past two years. Vessels also have to be at least 10 years old. The scheme operates on a competitive tender basis with bids ranked on a pound per gross tonne basis.
	Successful applicants will be allowed to dispose of or transfer their fish quota entitlements to another vessel owner or to a producers' organisation. They will have up to three years to complete the transfer. There are differing views within the industry on the transfer of quota, but we feel that this option is the most practical and best value for money.
	The principal method of disposal of decommissioned vessels will be scrapping. However, we recognise this country's proud maritime heritage and I am pleased to say that the rules of the scheme do make provision for the preservation of vessels of particular heritage significance.
	The closing date for applications is 16th November 2001 and successful applicants will be expected to have decommissioned their vessels and surrendered all licences and entitlements before 27th February 2002. We will also aim to let applicants know the results of their application as soon as possible after the closing date so that they can have the maximum amount of time to arrange for the disposal of their vessel.
	The scheme is a key part of a £22.5 million package of aid which we are making available to the English fishing industry in recognition of the difficulties currently facing the fishing industry. I commend the scheme to the House.
	Moved, That the scheme laid before the House on 15th October be approved [6th Report from the Joint Committee].—(Lord Whitty.)

Lord Greaves: My Lords, from these Benches we offer our broad support for the scheme. It is virtually inevitable that a scheme of this kind has been put in place, given that we have too few fish being chased by too many boats. As a result, major cuts have been made to fishing quotas. However, we look forward to seeing the results of research looking into alternatives to decommissioning which DEFRA has commissioned at the University of Portsmouth. In particular, we hope to find out whether in the future other means of effort reduction in the industry might be possible. Perhaps the Minister will be able to comment on this point.
	A further concern that has been expressed relates to the tight deadlines which have been set for the receipt of applications. The Minister has told the House that the final date for applications is tomorrow, 16th November. Furthermore, decommissioning and the surrender of licences has to take place by 27th February next year. Can the Minister comment on whether sufficient applications have been received to take up the funding available in the scheme? Could a measure of flexibility be built into the system if it proves difficult to complete decommissioning and surrender of quotas by 27th February 2002?
	A further point of concern is whether the effort towards fleet reduction is genuinely being shared evenly around all the appropriate areas of the European Union or whether in fact the effort is falling unduly on to fishermen in this country because here the scheme is being enforced with rigour. Perhaps the Minister can tell noble Lords what evidence the Government will produce in due course to demonstrate that similar decommissioning schemes are being put in place throughout the relevant areas of the European Union.
	Finally, concerns have been expressed about the trade in quotas, to which the Minister briefly referred. It is feared that quotas for traditional fishing areas could be lost. I refer in particular to certain parts of the South West which have been badly affected. The economic and social effects on communities go rather further than the narrow terms of the statutory instrument. Perhaps the Minister could outline for noble Lords measures the Government intend to introduce to provide support for such communities.

Lord Glentoran: My Lords, Members on this side of the House understand the reasons for bringing forward this instrument. We, too, wish to achieve the key objective; namely, the preservation of fish stocks for the future. However, I have a few points of concern.
	First, I wish to comment on the general performance of the common fisheries policy. I am not confident that it is doing its job adequately, any more than is the common agricultural policy. Along with the leader of the Cornish fishermen, mentioned by my honourable friend in another place, I am rather cynical about the political process involved in agreeing to the cuts in quotas. Those negotiations appear to allow every Minister concerned to return declaring that they have done better than anyone could have expected.
	Today I had sight of a report on Spanish fishermen, who fortunately were caught out by a Conservative MEP, Mr Struan Stevenson. The fishermen had attempted to switch moneys destined to help towards decommissioning into fleet reconstruction. I apologise to the Minister that I have not been able to pass the report on to him, but I received it myself only about 10 minutes ago. As I have said, we do not have much confidence in the process, but equally there is little that we can do about it.
	A second area of particular concern is that it appears that English fishermen have come off worst in this round. From the base numbers, it seems that Scottish fishermen have certainly fared better. I regret that I do not have the exact figures to hand, although I have tried to secure them. The reception given to the scheme in Northern Ireland suggests that those fishermen were rather happy with the terms they were offered. I suspect that they, too, fared rather better than the English. The same applies to the Welsh. Earlier I warned the Minister that I would ask a question about the differing national levels of quotas. I seek an assurance that fishermen in England have not come off worse than their counterparts elsewhere in the kingdom.
	Perhaps I may join the noble Lord, Lord Greaves, in expressing concern about the time-scale for decommissioning and getting rid of fishing boats. The Minister will know that the price of scrap metal is extremely low. To complete all the tasks by 27th February 2002 appears very demanding. I, too, ask the Minister to consider whether any flexibility could be allowed as regards that part of the scheme.
	Lastly, I should say that this morning I was interviewed by Radio Cornwall. The interviewer told me that a group of local tunny fishermen simply did not know what to do. They had not received adequate responses to questions they had put to department officials. They did not know whether to keep their ships and apply for the licences—which I understand from a MAFF release dated 19th March 2001 are now being given out again—or to apply for grants to join this decommissioning scheme. I look forward to the Minister's response.

Lord Pearson of Rannoch: My Lords, this is another sad day for the British fishing industry and for those who wish to live their lives within it. Before we joined the European Union and the common fisheries policy, the United Kingdom used to own some 80 per cent of the fish which swam in EU waters. Now we are reduced to landing some 25 per cent of the permitted EU catch.
	Can the Minister say whether progress has been made on altering the perfectly crazy system by which the European Union attempts to practise conservation by limiting the amount of fish landed in port as opposed to limiting the amount of fish brought up in nets? After all, most of the fish are dead when they come up in nets. Presumably, that is a fact of which the bureaucrats who designed the common fisheries policy were not aware. It is doing enormous damage, so is there any chance of moving away from the system of limiting the fish landed in port towards one of keeping the fish that are caught?
	Is there any progress on other technical measures such as altering the mesh, which I understand has scientific support and has been tried elsewhere?
	Against that background, have the fishing industry and fishing communities been made aware by Her Majesty's Government that the present CFP comes to an end in 2002, next year, when the derogations that have allowed us national quotas will come to an end and the real common fisheries policy—which is equal access for all members, controlled by our good friend the Commission—will be asserted? In asking the question, I am not so interested in the six and 12-mile limits—I understand that they may come back our way—but I am interested in the 200-mile limit, which is what we used to have and is where most of the fish will be. How will that limit be managed when the derogations expire? If the Minister cannot answer that question at the moment, can he assure the House that the industry is being made aware of this dismal future?
	I join other noble Lords in asking the Minister what the other countries are doing. Are they decommissioning to the same extent? Can the Minister supply figures particularly for Spain, the Netherlands and Ireland? I ask about Spain because the last time I looked at this matter was some time ago, when the United Kingdom was giving, I think, some £14 million more annually to Spain—with which to build new ships to come and take what used to be our fish—than we were to our own fisherman to decommission.
	What is the position with Spain? Is it true that the European Union is giving Spain some colossal figure—I heard mention of £100 million—in compensation for the fish that Spain will no longer be able to take from Morocco under the third country deal?
	I hope that I have not asked the Minister too many questions. The common fisheries policy is one of the worst aspects of our membership of the European Union; it is indefensible. Perhaps the noble Lord will confirm that it is irreparable because the vote to put it onto any kind of sensible footing simply cannot be mustered in Brussels? Is that the situation, or am I being too pessimistic? Can the Minister put me right on these points?

Lord Willoughby de Broke: My Lords, I may have misunderstood the Minister—in which case I apologise for wasting the time of the House—but I understood him to say that when these vessels are decommissioned the quota is transferred to other owners or other vessels. Is that correct? If so, it would seem that we are not getting anywhere with the issue of catching fewer fish because the same amount of fish will presumably be caught by other vessels which may have been modernised. We are just decommissioning the boats, as I understand it, while allowing the same amount of fish to be caught under the quota licences. That is my only question. I hope that the Minister is able to answer it.

Lord Whitty: My Lords, I have been asked a number of detailed questions, not all of which I can respond to. As regards the queries of the noble Lord, Lord Greaves, it is true that the Government have commissioned research into alternatives to decommissioning to meet the combined effects of the need to conserve stocks and its economic impact on the fishing industry and fishing areas. It is to be hoped that we can look at some alternatives in that area.
	The noble Lords, Lord Greaves and Lord Glentoran, raised the question of meeting the deadlines, particularly the February one, under this procedure. There has been considerable discussion with the industry; therefore the owners will know that the scheme is about to come into operation. As to the February deadline, it is a February deadline because we have to spend the money by March. We are exploring with those affected ways in which we can address their concerns about their ability to meet the timetable, obviously subject to safeguarding public expenditure. We recognise that there may need to be some flexibility in that.
	The issue of the relative enforcement of the scheme in the UK and other states was raised. The noble Lord, Lord Pearson, also referred to this in some respects. Clearly all member states are subject to EU limits. Action is taken against member states who do not meet their obligations. As to the question of enforcement as such, a recent Commission report provides a comprehensive and detailed overview of monitoring and surveying standards within the Community in each member state. In its recent Green Paper, which leads into the review of the common fisheries policy, the Commission sets out a number of ideas for strengthening fisheries control which include joint inspections, harmonisation of penalties and administrative penalties. The Government will play a constructive role in that as part of our general approach to the review of fisheries policy.
	I do not entirely dissent from the view of the noble Lord, Lord Pearson, that the common fisheries policy is one of the least effective parts of our membership of the European Union. As he knows, I do not often agree with him on European Union matters, but clearly there are serious problems with the fisheries policy. Our objectives in the review are intended to address environmental and other issues and to integrate those concerns into fisheries management.
	The industry is well aware of the timetable for the review. The noble Lord, Lord Pearson, was not entirely accurate when he said that the present CFP provisions will expire in 2002. It is not true that the current CFP, with its relative stability—even if it does have its drawbacks—will lapse automatically at the end of 2002. It will be for member states to decide by QMV whether changes are needed. If no changes are agreed among member states, then, with the exception of the restrictions on access within six and 12 miles to which the noble Lord also referred, all existing provisions would apply automatically beyond 2002. So we are not approaching a sudden abyss where people do not know what is beyond. I cannot give the noble Lord the figures on the size of commissioning commitments—indeed, no one will have them at this point under this scheme for any of the countries in the EU. I shall see whether there is any useful information that I can provide on that front.

Lord Pearson of Rannoch: My Lords, it would be much more useful if the noble Lord would make sure that the industry is aware of the position—although, of course, I should be interested in having a copy of anything that he has to say. There is considerable doubt as to what will happen in 2002, particularly with regard to the 200-mile limit.

Lord Whitty: My Lords, I accept that there has been misleading speculation, but the legal and constitutional situation is as I have stated.
	The noble Lord, Lord Greaves, raised a point about the fishing areas. The £22.5 million package for English fisheries is part of a total of, I think, £65 million which is provided in England, Scotland, Wales and Northern Ireland for support for the fisheries areas and fisheries restructuring. So the £6 million scheme for English fisheries on decommissioning is but a small part of the total support that we are giving to fisheries and fisheries areas.
	The noble Lord, Lord Glentoran, raised a question on the relative position of England and Scotland. Decisions on decommissioning schemes are largely devolved matters within the overall framework. Therefore, decisions are subject to the decisions of the Scottish Executive and the Northern Ireland Executive. The Welsh have not gone for one in this case.
	It is correct to say that there is a significant difference between the amount of money provided for the scheme in Scotland and in England: £25 million is provided in Scotland and £6 million in England. Although there are as many boats in England as there are in Scotland, more Scottish boats are directly affected by the current problems with white fish stocks; Scottish boats also have a significantly larger average size and therefore cost more to decommission. So to take out the same percentage of the English cod fleet as the Scottish cod fleet less funding would be needed. Roughly speaking, in terms of the types of boats involved and their size, the capacity ratio of Scottish to English boats is nearly 4:1; therefore £25 million to £6 million is not seriously out in proportionate terms. Another £5 million is involved under the scheme for Northern Ireland—which again is broadly proportionate taking account of the size of the fleet.
	The noble Lord raised the issue of Cornwall and the tunny fishermen. This is a complicated area. There are relatively few involved. The tunny fishermen were taken out of the industry by the changes in regulations in regard to nets. They can return with less substantial driftnets under the new regulations. They are eligible to apply for decommissioning under the present scheme if they feel that the fact that they can no longer use driftnets has driven them out of the tunny fish fields. What I have said about flexibility of approach in terms of a deadline would apply in this case as well. We do not expect to see significant problems in relation to the deadline. We are discussing it with representatives of the industry in Cornwall, as we are elsewhere.

Lord Pearson of Rannoch: My Lords, before the noble Lord sits down, he was good enough to say—but I should be glad if he would confirm—that he would write to us about some of the questions that he has not been able to answer this evening. He made a remarkable stab at doing so.
	But the question remains as to whether there has been any progress on abandoning the system of trying to practise conservation by the amount of fish that are brought up on deck, most of which are dead. In other words, has there been any progress towards abandoning the wickedly destructive environmental policy of discards? Can the Minister give any figures relating to what Spain, the Netherlands and Ireland are up to? What is the amount of compensation that Spain is receiving for being graciously pleased no longer to take the fish from Morocco in the way it has taken so many of ours?

Lord Glentoran: My Lords, perhaps I can help the Minister. I believe that I have the last figure referred to. It is 197 million euros.

Lord Whitty: My Lords, I am grateful to the noble Lord. I am not sure whether the figure matches precisely what the noble Lord, Lord Pearson, is asking. It is not that I doubt the noble Lord, Lord Glentoran, but I shall check the relativities compared with the total expenditure on Spain and on the United Kingdom.
	So far as concerns the measures for landing fish and how we count landing, we constantly review the best ways in which we can manage the quota. We are constantly examining ways in which to lessen the problem of discards. But there is no specific progress to report. I commend the scheme to the House.

On Question, Motion agreed to.

Railway Administration Order Rules 2001

Viscount Astor: rose to move, That an humble Address be presented to Her Majesty praying that the rules, laid before the House on 8th October, be annulled (S.I. 2001/3352).

Viscount Astor: My Lords, my main reason for moving this Motion stems from the questions asked in the recent debate on Railtrack by my noble friend Lord Hunt about a grey market in shares. Since then, I have had an opportunity to see the effect. It is extraordinary that the average turnover of shares in Railtrack was under half a million prior to the events, but on the Thursday and Friday when the Secretary of State acted the turnover was 3 million and 1 million. So it seems to me that there is certainly a case to be answered about a grey market and who did or did not benefit.
	In a Statement to another place on 25th July, the Secretary of State said—

Lord Falconer of Thoroton: My Lords, the Secretary of State made no Statement on 25th July. Will the noble Viscount indicate which Statement he is referring to?

Viscount Astor: My Lords, I may have got the date wrong, but he certainly made a Statement. I have given the noble and learned Lord advance notice of my remarks, so I hope that he will not use it against me all the time because I am trying to be helpful to allow him to answer a question.
	He said that the chairman of Railtrack had said that the position was far worse than had been previously thought, and that it was clear that unless extra financial assistance was provided by the Government on 8th November, when Railtrack was due to announce its interim results, it would be unable to make the critical statement that it was a going concern. I may have got the date wrong as to when he actually said it, but that is what the Secretary of State said. In other words, he said that Mr Robinson had come to him and asked for more money.
	We know from yesterday's Select Committee meeting during which the Secretary of State gave evidence that Mr Robinson did not at any point ask for any more money. The Secretary of State said in his evidence that he merely asked for a "soft letter of comfort". I understand that such a letter was to reassure the markets following a number of derogatory comments made by the regulator. Indeed, with a soft letter of comfort, Railtrack would have been able to continue with its planned bond issue in January and not require any more money. I wonder whether the noble and learned Lord can clarify the position.
	The Secretary of State was very helpful to the Select Committee, making his notes from the meeting with Mr Robinson available. I believe that it was the meeting that took place on 25th July rather than a statement. I see the noble and learned Lord nodding. I wonder whether those notes can be made available to this House.
	We also have conflicting accounts with regard to the regulator. First, the regulator indicated to the House of Commons Select Committee last Wednesday that he was to all intents and purposes threatened by the Secretary of State with emergency laws to strip him of his powers if he intervened to stop Railtrack going into administration. In another place on 5th November, and again in his evidence to the House of Commons Select Committee, the Secretary of State said that there was no threat. In the Select Committee, he suggested that there was clearly no threat because the regulator did then make an offer to Railtrack to consider an interim review, but that it was Railtrack that did not want one.
	I wonder whether these are the full facts. We know from the evidence given to the Select Committee by both the chief executive of Railtrack, Mr Marshall, and the regulator, Mr Winsor, that on Saturday 6th October Railtrack asked the regulator about the possibility of a review. It seems clear that within that discussion Railtrack chose not formally to ask for a review because it knew that the regulator had effectively been told that a review was not possible and that therefore the Secretary of State would introduce legislation.
	I hope that the noble and learned Lord can explain—

Lord Faulkner of Worcester: My Lords, I thank the noble Viscount for giving way. In the interests of the full facts, as he calls them, would it not be more sensible to continue with some of the other comments of Mr Winsor to the Select Committee last week, such as,
	"They had no credible alternative to administration . . . I don't know why they didn't oppose the petition . . . I believe they are the authors of their own misfortune . . . I believe that the core problem of the railway industry is the competence of the management of the company . . . It failed to understand the simple realities of its business, which are this: you do not neglect your assets and you are not hostile to your customers"?
	Surely Mr Winsor got that absolutely right.

Viscount Astor: My Lords, we can all quote for ever the proceedings of the Select Committee. However, I made a separate point from that. Mr Winsor made many remarks about Railtrack. I am talking about the Secretary of State and regulation. The point the noble Lord, Lord Faulkner, made is not relevant to that.
	I wonder whether the noble and learned Lord can clarify the anomalies here. Returning to the financial aspects of Railtrack, we again seem to have conflicting accounts. Following negotiations in April it was agreed that the Government would provide to Railtrack, as part of the Renewco money, £162 million on 1st October. However, that money was not on that date made available to Railtrack. What was the reason for that? If it had been made available as promised, the status of insolvency would have had to be considered in a different light. The chairman of the Strategic Rail Authority notes in a letter to the Permanent Secretary on 1st October that, with regard to the implementation of Renewco by the 1st October deadline,
	"The SRA has played its part fully and competently in this story. We have explained again and again how all this must work . . . I do not suggest that the Treasury is blameless in the matter but . . . the primary responsibility must lie with your department".
	In other words, the failure to transfer the £162 million was the responsibility of the noble and learned Lord's department. Yet the Secretary of State informed the Select Committee yesterday that the problem was not caused by himself or his department, but that the money was delayed purely by the Strategic Rail Authority. Can the noble and learned Lord explain that?
	Finally, there are two issues relating to administration which I should be grateful if the Minister could clarify. First, the Secretary of State noted to the Select Committee yesterday that he wants the period of administration to last no longer than a few months, not six or nine months. Yet we know from the administrator's own evidence that he felt that six months,
	"looks like a tight timetable".
	Will the noble and learned Lord comment on that?
	Secondly, will the noble and learned Lord explain how the Secretary of State will be able to make a neutral decision on the replacement of Railtrack—as he said in yesterday's evidence to the Select Committee—when at the same time he will be the architect of one of its proposed new models? How can we be assured that other companies, which I understand are considering making offers, will be given a fair hearing for their proposals? Will the noble and learned Lord confirm that Railtrack was put into administration for purely financial reasons and therefore the Secretary of State will consider proposals from the private sector should they come forward? Is it not the responsibility of the administrator to procure the best offer? I hope that the noble and learned Lord can respond to those points and clear up much misunderstanding that has surrounded this issue. That would certainly help all of us who have an interest in it. I beg to move.
	Moved, That an humble Address be presented to Her Majesty praying that the rules, laid before the House on 8th October, be annulled (S.I. 2001/3352)—(Viscount Astor.)

Lord Elder: My Lords, before the noble Viscount sits down, will he help us by telling the House whether or not he agrees with Railtrack's board that shareholders should get £3.60 a share and, if so, where does he believe the extra money—which may well be about £1 billion—will come from? Should it come from the taxpayer or from rail users through higher fares?

Viscount Astor: My Lords, I have sat down. When I speak later I may deal with the noble Lord's question.

Lord Bradshaw: My Lords, I intervene to say that we on these Benches have no special sympathy for the shareholders of Railtrack. It was a thoroughly inefficient company which from its very beginning wanted more money from the taxpayer. We see no reason why the taxpayer should pay that money. If wrong has been done, it will be found out. However, we believe that the Secretary of State in another place has a duty to ensure that new arrangements which are put in place fully serve the interests of the people who are paramount in this; that is, the rail users, who were never properly considered by Railtrack, as has been said. I want to make that clear before the Minister replies.

Lord Falconer of Thoroton: My Lords, these rules make possible fewer applications being made to court and, therefore, make it cheaper for all involved. Nevertheless, the noble Viscount, Lord Astor, prays against the rules. I cannot believe it is in order to increase the costs of the administration. He asked eight questions.
	First, he read from an undated statement made by the Secretary of State and said that something inconsistent with that statement was said by the Secretary of State in the evidence he gave to the Select Committee yesterday. I refer the noble Viscount to Answers 845 and following in the evidence given by the Secretary of State yesterday to the Select Committee. I do not think that it is worthwhile to make forensic points of the kind the noble Viscount made.
	Secondly, the noble Viscount asked whether the notes would be made available to this House. As he knows, because he will have read the evidence of the Secretary of State to the Select Committee, he would have offered it the notes if the committee found that helpful. It is a matter between the Select Committee and the Secretary of State as regards what happens to the notes.
	Thirdly, the noble Viscount asked about what he called threats. He knows, because he has read the evidence, that the Secretary of State denies that any threats were made. Indeed, it was made clear by Mr Winsor, the regulator, that he told Railtrack that if it wanted an interim review, it would be considered and it would be possible for Mr Winsor immediately and publicly to announce that he had begun such a review. That was made clear to Railtrack on the Saturday. Again, that evidence was made clear in the Select Committee.
	The fourth question the noble Viscount asked concerned the £162 million that he said was due and payable on 1st October. As the noble Viscount knows, as he will have read the Select Committee evidence, the position was that an agreement had been reached in April that best endeavours would be made in order to make the sum payable on 1st October. The SRA and Railtrack in good faith sought to establish that those conditions would be met by that date. They were not met because the Office for National Statistics had not made a decision about whether the particular arrangement would be on or off balance sheet. Therefore, the payment could not go ahead.
	Fifthly, the noble Viscount asked about the length of time the administration would take. The Secretary of State said it would take a few months; the administrator said that time would be tight at six months. I shall not try to predict how long that kind of thing will take.
	Sixthly, the noble Viscount asked how the Secretary of State could make a neutral decision about bids. As the noble Viscount will know, guidelines have been issued by the Secretary of State. He will also have the advice of the administrator before he makes a decision.
	Seventhly, the noble Viscount asked whether the administration order was made by reason of insolvency. The noble Viscount will have read the reasons given by the Honourable Mr Justice Lightman for making the order. He said that such an order was necessary because of a deficiency, which means that Railtrack was unable to pay its debts at the time that an administration order was made.
	Eighthly, the noble Viscount referred to the circumstances in which private sector bids will be considered. He asked whether the administrator would act in pursuance of the best interests of Railtrack. The administrator will have to act in accordance with his duties under law.

Viscount Astor: My Lords, I am grateful for the noble and learned Lord's response to my points of which I had given him prior notice. He has replied to most of my points, for which I am grateful. However, on a couple of points he did not go into as much detail as I should wish, but I am sure that we shall come back to them.
	I say to the noble Lord who asked about the shareholders that that is purely a matter for the administrator. He has the statutory duty to do the best he can for Railtrack and the shareholders. I have absolutely no view nor, indeed, knowledge, of what might happen in that regard. That is a matter for him. I find it surprising that the noble Lord should even speculate on it, because it is a duty of the administrator.
	A little more light has been shed on the subject. We are concerned that a false market existed in the trading of the shares. There is ample evidence that there was substantial turnover in the shares just before the Secretary of State's announcement. That will have to be looked into. I am sorry that the noble and learned Lord said that he did not want to look into some of the aspects in great detail. I give him warning that we shall have to come back to that in the future.
	I am sure that the Government Chief Whip will be pleased—I see that he has a smile on his face—to hear that I shall leave this subject for the moment. I beg leave to withdraw the Motion.

Motion, by leave, withdrawn.
	[The Sitting was suspended from 8.51 until 8.57 p.m.]

European Communities (Amendment) Bill

House again in Committee on Clause 1.

Lord Howell of Guildford: moved Amendment No. 18:
	Page 1, line 9, after "10," insert "other than Article 2, paragraph 12, revising Article 157(3) of the Treaty establishing the European Community,"

Lord Howell of Guildford: The amendment brings our focus to Article 157 of the treaty establishing the European Community—not the Treaty on European Union. The article has been somewhat amended by the Nice treaty, raising a number of issues that give us cause for concern on these Benches.
	Article 157 contains, and has contained from previous treaties, the injunction that the Community and the member states shall ensure that the conditions necessary for the competitiveness of the Community's industry exist—not the conditions for competition, which is a substantially different objective. There has been much rhetoric and many commitments on that. Various European summits and councils have pledged themselves to achieve a variety of aims for speeding up the adjustment of industry and promoting innovation, research, technological development and so on.
	The other day, at an enlargement conference in central Europe, I heard one rather angry supporter of further integration demanding to know why the Lisbon agenda had not been achieved. Through my mind passed the thought that maybe it was not within the power of Ministers, gathered in a council or in any other way, to achieve the hugely bold commitments to innovation, to catching up the United States in high technology and the information revolution and generally to creating the impetus for innovation, which is the driving force of the economic process and the creation of wealth. Yet that was not understood.
	I believe that that failure to understand drives deeply into the mentality of policy-makers, both in our respective member states and at the European institution level. It leads to a constant disappointment that governments cannot deliver the innovation impetus. They can do certain co-ordinating work—which they do—and very valuable work in research, and so on. But the basic driving forces of economic process are, of course, innovation, the anomalies and discoveries which create new opportunities and the drive of the wealth-creating process, whether in large or small firms.
	The Government cannot do that. When governments try to do it, they find it difficult enough, except possibly in wartime. When governments try to do so at a supranational or even international level, the results are very small. In fact, in the case of the Lisbon declarations, they produce nothing at all.
	What the Nice treaty does to Article 157 is to insist that:
	"The Council, acting in accordance with the procedure referred to in Article 251 and after consulting the Economic and Social Committee, may decide on specific measures",
	and so on and so forth. Of course, it will come as no surprise to any of us that Article 251 is one that specifies that the Council will act by qualified majority voting. I am not quite clear whether that is a new QMV because it is in dark print in Article 157, although that is not the case in respect of Article 251, or whether that provision was present beforehand.
	Either way, it is trying to push the machine in directions in which I do not believe that it will go. It is trying to do so with an impatience which demands QMV where the patience of unanimity had led to frustration. Perhaps the argument is that, if member states opt for QMV, magic will be achieved in innovation, promotion, and so on, in a way that did not happen with unanimity. Personally, I doubt very much that it will make the slightest difference, except that certain initiatives will be taken not by unanimity but probably by a qualified majority vote if things go wrong and one or two countries object. They, too, will probably lead to the same results as the unanimity provisions have led to, which is not very much at all.
	The saving grace of Article 157, which perhaps leads one to be cautious as to whether to drop it altogether, is that the article contains—rather, there has been inserted in it by the Nice treaty—a reservation which is rather cheering if true. That reservation is that the,
	"Title shall not provide a basis for the introduction by the Community of any measure which could lead to a distortion of competition"—
	that was in the previous treaty, and these are the new words—
	"or contains tax provisions or provisions relating to the rights and interests of employed persons".
	I wonder whether that is accurate. The interests of the employed person are, indeed, affected by certain articles of the treaty but perhaps not by this one. However, many employed people would say that their situation is very directly affected by articles of the treaty. I am a little puzzled as to how we can stand upright and say that that is so when it seems to conflict with common experience.
	Amendment No. 19, which is grouped with this one, refers to Article 161 and concerns the task priorities, objectives and organisation of the structural funds. Here, the new black print states that from 1st January 2007, which is some way ahead,
	"the Council shall act by a qualified majority on a proposal from the Commission after obtaining the assent of the European Parliament and after consulting the Economic and Social Committee and the Committee of the Regions"—
	there is plenty of work there to fill the time of those committees—
	"if, by that date, the multiannual financial perspective applicable from 1 January 2007 and the Interinstitutional Agreement"—
	please do not blame me for the language—
	"relating thereto have been adopted. If such is not the case, the procedure laid down by this paragraph shall apply from the date of their adoption".
	Frankly, that is obscure. It seems to me that QMVs are entering another area. I do not know whether or not that is a matter that should worry us. It is almost impossible to tell, but perhaps the Minister will bring his usual illumination and light to this particular complex clause and tell us what it is all about. I beg to move.

Lord Wallace of Saltaire: I rise briefly to say that I believe that both Articles 157 and 161 are good examples of political statements of policy which should not be in the treaty but should be part of the normal negotiation among governments. However, that is a question to which we shall return when we start to discuss the next inter-governmental conference and how one might then revise the treaty.
	Given the conditions under which we are operating, it seems to me that the Government should be very happy with these two changes. One excludes the possibility of tax questions being introduced in relation to employment. The second will prevent some of the most self-interested member governments on the Cohesion Fund blocking the changes in that fund that are necessary to cope with enlargement. I say nothing about the Spanish Government in this respect. However, we are very conscious that this is precisely an area where QMV is definitely in the interests of the British and others who wish to see Community spending directed at those who need it and not at the vested interests who already have it.

Lord McIntosh of Haringey: I am disappointed that the noble Lord, Lord Howell, should be so defeatist. I can understand that it is legitimate to question whether the European Union can have effect at some height above in Brussels on industrial policy. However, he goes further. He is suggesting that it is beyond the competence of the United Kingdom Government to help industry. I simply do not believe that. I consider that the experience of the past four-and-a-half years is that we have been successful in helping industry, both in terms of deregulation and, above all, in the way in which we have provided an economic climate of stability for industry.
	As the noble Lord speaks so much about small and medium-sized enterprises, perhaps I may reiterate that, having run a small and medium-sized enterprise—smaller rather than medium, I believe—for 30 years, I should have much appreciated the degree of stability which has existed since I left it and joined government.
	Article 157 allows the Community to take co-operative action; in other words, it involves measures that support the actions taken in member states. That is my answer to the noble Lord, Lord Wallace, who said that the provision should not be in the treaty. In the sense that he meant it, it is not in the treaty. The provision relates to the support of member state action to increase the openness and competitiveness of industrial markets. In view of the contributions of the noble Lords, Lord Wallace and Lord Howell, I really cannot see what objection there can be about such support.
	The noble Lord, Lord Howell, was right—new paragraph (3), which was agreed at Nice, changes the article's requirements from unanimity to qualified majority voting. We agree with that; we supported and encouraged it and it is in our interest to have QMV for industrial policy. It will help to further the Lisbon economic reform agenda and to increase competition. I wonder whether the Conservative Party disagrees with those objectives. In case the issue should arise, we ensured that there was a carve-out from the article to protect measures involving taxation or the rights and interests of employed persons.
	Amendment No. 19 refers to Article 161, which determines how structural and cohesion funds are allocated and managed. The answer is that the amount of structural and cohesion funds is set by unanimity but that the distribution of those funds will be determined by QMV. Again, that seems to us to be entirely right. The amount that the funds contain is agreed by the European Council by unanimity within the six-yearly financial perspective. The current financial perspective runs out in 2006.
	The new final paragraph to which the noble Lord referred was agreed at Nice and moves the article relating to QMV from 2007; that is, after the next perspective or, if no agreement is reached by then on the next financial perspective, following that decision. Surely it is right that one member state should not be able to hold a necessary, fair and worthwhile allocation of structural funds to ransom. The noble Lord, Lord Wallace, referred tactfully to that; I shall not mention any member states.
	QMV will mean that a fairer deal is negotiated for everybody. No one will be able to veto in order to hold out for an unfair share. In summary, the overall amounts of money spent on structural funds will continue to be decided by the European Council when it sets the financial perspective. On unanimity, it is right that the distribution of those funds should be subject to QMV; in other words, subject to Article 251.

Lord Biffen: I intervene briefly primarily to say how much I appreciate the Minister's kind words about G. C. Coulson, the great Protestant historian. I never thought that such an opportunity would fall my way, least of all in debates upon the European Union. It just shows that there are small nuggets to be mined even in the most unpromising of circumstances.
	At this stage of the evening, one begins to bewail absent guests or absent performers. I much regret the absence of the noble Lord, Lord Hannay, who is not here to put the succinct explanation of government policy that so often eludes the ministerial Front Bench; but there we are. They may still be working at the Quai d'Orsay but at least the hours are more civilised at the Foreign Office.
	My other regret involves the absence of any spectre from the Treasury. At the end of the day, this is very much a Treasury matter. We are being asked to put into the legislation a proposal that is not really very necessary. I am delighted to have the support of the noble Lord, Lord Wallace, on that point. I cannot believe that the economic directions of Community policy would be in any sense prejudiced if the proposal were not written into the treaty. I say that because on the whole, although the EU, which originally by nomenclature was the Common Market, had a strong free trade emphasis (a classical liberal emphasis) on the destruction of tariffs—although it also preserved a more protective arrangement for agriculture—we are inevitably learning that the high noon of free trade may be passing. That is the case despite the Statement earlier today about the World Trade Organisation. I suspect that even there we are moving towards guided trade rather than open trade.
	In this situation one wants as little formal commitment as possible. The formal commitment in Article 17 will be seized on by those driving for greater Community expenditure, for the reality is that the treaty postulates membership that I believe will substantially transform the character of the European Union—not least by virtue of the great gap in living standards between the applicant countries and the existing membership.
	That will give rise to constant pressure for a transfer of resources within the European Union to offset that material disadvantage. But, also, that is likely to take place against the disciplines of the single currency. I shall not enter the guessing game about the consequences of the single currency, but there is respectable opinion—not merely that of so-called Eurosceptics—that says that the single currency will result in a substantial redistribution of wealth within the Community. If that is so, all the pressure will again be to try to use public spending as a way out—or at least as some kind of emollient—of the situation.
	I say to the House that we cheerfully, or with a certain amount of regret or cynicism, pass such legislation, all of which is setting the disciplines for substantial pressures on European Union public spending. At the end of the day, that public spending will be good old-fashioned pork barrel spending, in which various countries will be trading off to get advantages, knowing perfectly well that the Irish have demonstrated what can be done in that direction. As someone who has spent his life being on the whole mildly, but not excessively, critical about levels of public spending, what is damaging is not so much the total volume but the quality of public spending, because it becomes highly politicised and less and less relevant to trying to remedy those things that should be countered by a collective attitude.

Lord McIntosh of Haringey: I am tempted to rise again, first, because I very much appreciated what the noble Lord, Lord Biffen, said about Coulson, the
	"Remote and ineffectual Don
	That dared attack my Chesterton". Perhaps we should go out to recite the poem at considerable length in public. As I said, it is one of the finest pieces of literary invective that I have ever known.
	I also have sympathy with what the noble Lord said about the multinational direction of industry, but that is not what Article 157 provides. Article 157 concerns co-operative action; it is about action in support of action taken by member states. If the noble Lord wants evidence of how that can work in practice, it was demonstrated earlier this afternoon. My noble friend Lady Symons then described how a way forward had been found at Doha that had not been found at Seattle to promote liberalisation of international trade in which it was the European Union, acting as a whole, that succeeded in breaking some of the log-jams that had arisen at Seattle. That is worth doing and is encouraged by not just this treaty but by all the treaties of the European Union.

Lord Howell of Guildford: I apologise to the Committee—I seem to have started something with my adjectives "remote" and "ineffectual". Perhaps we can discuss them further at another time and I shall certainly read the full poem according to the Minister's injunction.

Lord McIntosh of Haringey: Enjoy the recital!

Lord Howell of Guildford: The reference that the Minister has just made to the work of the noble Baroness, Lady Symons, in the successful operation—so we hear—at Doha is a good example of where consultation and co-operation between as many of a group as one can get together—in that case the European Union group—clearly makes sense. However, the article is not about that, as my noble friend Lord Biffen said; it is about support for various perfectly commendable objectives—favourable environment, policies of innovation and research, and so on—but the issue is how those objectives are to be achieved. Are they to be achieved by a competitive, low-tax environment in the nation state, favourable to enterprise, initiative, investment and innovation, or are they to be an addition to be achieved by support from the European institutional level?
	There is the apocryphal story of the boy scout who insists on helping a senior citizen across the road only to discover on reaching the other side that she did not want to cross it in first place.
	I sometimes feel that some of this "wished-on-us" support coming from the European institutions over and above our national methods, over and above an appropriate degree of concertation and co-operation, is something that costs, but does not necessarily add value. One is entitled to look critically at the long lists of proposals supporting this and supporting that at Community level in ways which may not add value to the existing situation.

Lord McIntosh of Haringey: Is the noble Lord, Lord Howell, repudiating the structural fund? We are talking here about £10 billion of structural fund money coming to the United Kingdom between 2000 and 2006. We are talking about Objective 1 funding going to Merseyside, to South Yorkshire, Cornwall, West Wales and the Valleys. Conservative Members of Parliament in those areas, if there are any left, will not thank the noble Lord.

Lord Howell of Guildford: The noble Lord is premature. I am talking about Article 157. I have not yet come on to the structural and cohesion funds. I shall say a word about those in a moment. The Minister is taking several jumps ahead of what I am saying.
	I am referring to Article 157 and questioning some of the costly and often ineffective support programmes which tend to be fifth wheels on the coach of sensible industrial and tax policies conceived at national levels.
	The noble Lord tempts me to turn to Article 161 and the structural and cohesion funds. I am not saying what he thinks I am saying; I am interested that these matters are to be handled in a different way after 2007 and that there will be a fair distribution of the funds. The figures he mentioned are very large.
	We must bear in mind, of course, that if all goes according to plan 2007 will be a time when there are more like 25 members of the European Union rather than 15. The new 10 will have a GNP per head of around one-quarter of the existing 15 and the clamour for their fair share of the structural and cohesion funds will be extremely loud. The need to ensure that the system is fair and that the weighting of votes is not always balanced in favour of the big boys or the existing members will be very important. I do not say that that cannot be achieved. But we shall have to watch very carefully indeed that fairness is perceived to exist by the 10 new applicants.
	Already voices can be heard both in the western end of the existing Union and in the central and eastern end of what will be the larger Union which are in contradiction to each other, each side saying it is they who should get the "fair" share in the distribution of the structural and cohesion funds.
	So these are serious issues, not to be turned into a party football bouncing me or anyone else into saying that we do not applaud the use of the funds when properly applied. They have no doubt brought benefit to many parts of the United Kingdom as well as to other parts of Europe. But a serious point arises here. If qualified majority voting is in operation after 2007 in this new enlarged Community of 25 plus, and maybe more, we must expect a few sparks to fly as people work out what is and what is not fair.
	Those are matters for further debate, not to be pressed further now. Therefore, in the light of some of the explanations given by the Minister, and in the light of other comments in this debate, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendment No. 19 not moved.]

Lord Howell of Guildford: moved Amendment No. 20:
	Page 1, line 9, after "10," insert "other than Article 2, paragraph 15, revising Article 175 (2) of the Treaty establishing the European Community,"

Lord Howell of Guildford: We turn now to Article 175 in the TEC—not the TEU—which again gives some cause for concern to those of us who are anxious that the Community and its institutions should concentrate on what they are good at and what adds value, and not be distracted into other areas where nation states, regions and smaller, more sensitive bodies—closer to the front line, as it were—may be more effective. The particular points which catch our eye are those in black type, which means that they have been introduced by the Nice Treaty to the existing corpus of treaty legislation.
	What we have here are propositions that the council shall decide what action is to be taken by the Community in order to achieve a number of objectives already in the treaty under Article 154. They include protecting human welfare, prudent utilisation of natural resources, and promotion at an international level to deal with regional, worldwide and environmental problems. One could not object to any of those points for a moment. They are obviously to the public good if they can be achieved.
	Then we have measures primarily of a fiscal nature—that was already in the treaty—measures affecting town and country planning; quantitative management of water resources affecting directly or indirectly the availability of those resources. Anyone can see that management of gigantic rivers necessarily needs to be concerted transnationally as it is for the river Rhine and across other borders throughout the Community. Indeed, one little known area of transnational co-operation is that by the River Foyle Authority between Northern Ireland and the Republic. That kind of co-operation between authorities which are able to operate transnationally can work perfectly well. I am not totally clear as to why we now need new measures to bring the Community so firmly in on the act. There may be points which I have missed. If so, I am sure the noble Lord will put me right. However, the extension of the competencies into management of water resources seems, once again, to be a development where subsidiarity has been forgotten.
	In this case were the rules followed for testing whether something should be put to the process of subsidiarity—such rules are often neglected but were originally in one of the earlier treaties—or did we just leap without hesitation into quantitative management of water resources and town and country planning, although I believe that already existed? What has happened to the idea of subsidiarity? Why is it not being promoted right through the treaty at every point? Why is not there a tone of the Community saying, "We will stick to what we can do in terms of rules and regulations. We have reached right across the Community to where we really can be a valuable support to the nation states and to the industries and citizens within them but on other matters we will, indeed, either not intrude or", better still—I realise this is asking for the moon—"unravel the commitments centrally which were suitable in a previous age but in the age of information revolution and high technology in which we now live can perfectly well be managed on a smaller scale at a further range from the centre"?
	Why are not those principles asserted in the new text? What happened at Nice that people forgot about subsidiarity and, instead, proposed new centrality, if that is the opposite of subsidiarity? We would like to know the answer to that question. That is the purpose of the amendment. I beg to move.

Lord Willoughby de Broke: I rise briefly to support my noble friend's amendment. It seems extraordinary that subsidiarity seems to have disappeared from this article, and I wondered why. My noble friend gave examples of intergovernmental co-operation, which seemed to work perfectly satisfactorily. I wonder why such examples are not followed more frequently in the European Union, rather than trying to operate them centrally. Here we have town and country planning and the quantitative management of water resources.
	I see that the noble Lord, Lord Williamson, is in his place. When he gave evidence to the European Select Committee he said that he thought that the Commission was trying to do far too much with things it should not mess with. He gave the example that amused me of giving prizes at a melon festival in Cavaillon. The management of town and country planning is one level up from that. There is also the quantitative management of water resources, which can be anything from winding a lock on a canal in Warwickshire to deciding the river flows on the Rhine, land used with the exception of waste management, and so on.
	Again, it appears that the Commission is trying to make decisions that should be taken at a national level. Can the Minister explain why these provisions are here and why such matters cannot be achieved on an intergovernmental basis? Why is it necessary for quantitative management of water resources to be in the treaty? Is that a significant factor in enlargement? Perhaps the acceding countries will benefit from the high quality management that the Commission and the Council of Ministers can bring to bear on their water resources.
	I look forward to hearing what the Minister has to say about that. Meanwhile, if my noble friend decides to press this amendment to a vote I shall support him.

Lord Stoddart of Swindon: I support this amendment. I too am concerned about subsidiarity. I remember discussing the Maastricht treaty. In this House we had 11 days of debate on the Maastricht treaty and we examined it fairly thoroughly. We were assured that the Maastricht treaty was good for Britain because some powers would be returned. We were promised that. The noble Lords, Lord Willoughby de Broke and Lord Pearson, were involved in those debates. I am sure that they will confirm that we were promised a return of powers that we had lost and that subsidiarity would give us game, set and match. Do noble Lords remember that? It was Mr Major's game, set and match. Unfortunately, it was not game, set and match, but a sell-out in exactly the same way as we have been sold out so many times.
	Perhaps my noble friend can tell me how many measures of subsidiarity have been put into operation since 1992 when we ratified the Maastricht treaty. I also want to know exactly what water resources have to do with the Community. My own experience tells me that when bigger and bigger organisations interfere with issues like water resources they make matters worse.
	When I was leader of Reading county borough council, a nationalisation measure came into being to bring the water companies and the water boards of Berkshire and south Oxfordshire into one board. It was a local board and worked successfully until the Metropolitan Water Board stepped in. The board said that in order to manage its own water throughout the Thames Valley and into the Thames basin, it needed to extract water from the Thames and the Kennet valleys, water that we have enjoyed from the green sands and the chalk for many hundreds of years. That board took out the beautiful, clean, sweet water and pumped it into the Thames where it became dirty. The water then travelled down to London and other places where it was extracted and the board had to clean it. The damage that that did to the wildlife and to the rivers of the Thames Valley and the Kennet Valley has to be seen to be believed.

Lord Watson of Richmond: The noble Lord asked rhetorically what should the EU have to do with water. Perhaps I may point out to the Committee that the EU intervention in the flow of polluted water on to the beaches of Britain, for example, has been one of the great pluses of the European experience in recent years. The reports on the new clean beaches of Blackpool were most reassuring and a confirmation of the efficacy of Europe in the matter of water.

Lord Stoddart of Swindon: The noble Lord thinks that he has made a very good point—

Noble Lords: He has!

Lord Stoddart of Swindon: I simply do not agree with him. It was not necessary to become members of the European Union or the Common Market in order to clean up our beaches. We had the opportunity to do so ourselves. Indeed, we have done it ourselves and we have paid for it ourselves. We have paid for it very highly ourselves! Therefore, the noble Lord cannot say that because we are members of the European Community we have had our beaches cleaned. The beaches have been cleaned because the British water consumers and taxpayers have paid for new sewage works, which could have been and would have been built without our membership of the European Community.
	In order to have good, clean water and beaches, it is not necessary to deal with it on a Community-wide basis. After all, we developed our water resources, our river basins and our sewage works over a long period of time without help from anyone else. Indeed, the great dams and sewage works which were built by the Victorians are evidence of that and we can see them every day. Therefore, I do not know why on earth the EU needs have any input into the way we provide water in this country.
	I am tempted to talk about electricity because at one time I worked in a power station and was a member of the electricity industry's national joint council. I do not see why the EU should be involved, but that is another matter. I am sure we want to get on and I look forward to the noble Lord's reply.

Lord McIntosh of Haringey: I have a self-denying ordinance; I like to talk about the Bill and about the amendment before us rather than other matters. But I must say that I am sorely tempted by my noble friend Lord Stoddart. He may not realise that 35 years ago I was a member of the Metropolitan Water Board—

Lord Stoddart of Swindon: Shame!

Lord McIntosh of Haringey: My noble friend despises it so much. We were the wicked big brothers down the river who destroyed the good, clean water from the green sand of the Thames Valley.

Lord Stoddart of Swindon: You did!

Lord McIntosh of Haringey: I believe that my noble friend was right and we were wrong, but I do not believe that that applies to the European Union. If ever there were an issue which crosses national boundaries, surely it is pollution. It is the environment. If ever there were an issue which can be dealt with better by multinational, collaborative action across a whole continent, it is the environment. I am sure that everyone will agree with that. I cannot believe that there can be any disagreement.
	Pollution does not respect national borders. It may to some extent respect the English Channel and the North Sea, but in Europe as a whole, clearly it does not respect national borders. Look at the Danube——

Lord Pearson of Rannoch: Why cannot there be intergovernmental collaboration? Why does one need the absurd and destructive paraphernalia of the European Union to clean up our water? It simply does not make sense.

Lord McIntosh of Haringey: It did not happen.

Lord Pearson of Rannoch: It did and, incidentally, at a cost of £40,000 million.

Lord McIntosh of Haringey: I do not get a word in edgeways here! The answer is that it did not happen. I admit that that may be because no one had ever thought of it at that time. The original Treaty of Rome did not refer to environmental protection and our awareness for such need has grown over the years and grown properly.
	Perhaps I may finish the sentence I began before the noble Lord, Lord Pearson, so politely interrupted. The waters of the Danube flow through many existing and future EU member states. It is true of the Rhine and of a very large number of what are called "water resources". It is precisely in these areas that we need common standards and rigorous procedures. The answer to the noble Lords, Lord Pearson, Lord Stoddart and Lord Willoughby, is that we are following this course because it did not happen before and there is no other way.
	Consciousness of the impact that the EU can make on environmental protection has grown as we have become aware of the need for tough action on that subject.

Baroness Park of Monmouth: Will the noble Lord allow me to intervene to say that one of the problems is that the theory is there but not always the fact? I remember that when we were discussing beaches we were shown a map and every blue flag on it indicated a good beach. A red flag showed a bad one. We were shown a map of Italy at the time. Every single flag was blue except one, which was for the Bay of Naples which nobody could possibly pretend was not polluted. So the theory is there, but it does not necessarily work.

Lord McIntosh of Haringey: Is it suggested that environmental protection would work better by being returned to national rather than international control? I cannot believe that the noble Baroness, who is so well informed about these things, can believe that.
	We moved over to QMV, it not having been present in the Treaty of Rome, in the single European Act and in Maastricht. All of that was carried out by Conservative governments. There is now a large measure of support from the citizens of Europe for action at a European level. Until hearing the strange debate this evening I should have thought that that was something with which everyone would agree.
	Environmental protection is not an area in which we can afford to have common standards at the level of the member state least willing to clean up its act. I believe that that is what we would finish up with. Environmental standards have to be demanding as well as achievable. That is why most of the environmental provisions in the treaties are already subject to qualified majority voting.
	Again, I have to disappoint the supporters of the Nice Treaty because I have to admit that it makes very minor adjustments to these provisions. They are good adjustments and I am surprised that anyone should oppose them. The one area which moved to QMV in this article is water quality. It is not a new competence, but the use of QMV is.
	Perhaps I may explain why I believe that that is right and where the logical objection to new QMV, whatever the reason—although not expressed in this House, but by the Opposition in another place—would actually harm Britain's interests. Water quality affects us all whether we are at home or visitors elsewhere in the EU. British companies need a level playing field on which to work. Why should others gain a competitive advantage by being able to meet less high standards of environmental protection? Qualified majority voting will prevent any member state lagging behind from keeping the standards below an acceptable level.
	There is also a perverse peculiarity in these amendments because Article 175 returns one of the aspects, which is land use, to unanimity of voting from QMV. The measures of a general nature on land use were part of a carve out which made them subject to QMV. That has been deleted because it was believed to be too vague and it will now be subject to unanimity. I did not hear the noble Lord, Lord Howell, or anyone else objecting to that change.
	The article on environmental measures is an excellent example of how at Nice we followed the rule on QMV which we have always followed; namely, to examine proposals for extension, and in this case for reduction, on their merits. Where we see advantage for Britain and efficiency, we shall agree with them as we have done here. Where we judge that there is a fundamental national interest which requires that we retain the veto, we shall not agree to QMV. In this article we do not agree that QMV should be extended to taxation measures—nor has it been.
	To set ourselves the standards required to guarantee environmental protection we need to use QMV and encourage those lagging behind to bring their standards up to an acceptable level. Without that, we all sink to the level of the polluters. We support these changes. The Government argued strongly for these measures and I hope that the Committee will not reject them.

Lord Willoughby de Broke: I did not want to interrupt the noble Lord. However, the Minister kept referring to qualitative management, whereas the article makes reference to quantitative management. Is there any difference?

Lord McIntosh of Haringey: I was not conscious that I used the word "qualitative" once. I spoke about water quality, which is one thing. Quantitative management of water resources means that there is enough water. Surely, that is equally an issue that does not respect national boundaries.

Lord Biffen: The Minister quoted management of the Danube, which is obviously appropriate in the context of European enlargement. In what way does he believe that the existing management of the Danube by the riparian nations is inadequate and would be enhanced as a result of the changes now proposed? I ask that question because I cannot believe that the noble Lord would have introduced that example without having evidence to support it.

Lord McIntosh of Haringey: The Danube is very peculiar in that it flows partly through the EU. It starts in southern Germany, as the noble Lord is aware, and flows partly through applicant states such as Hungary. It also forms a national boundary between applicant states—Hungary and the former Republic of Yugoslavia—and flows partly through states such as Romania and Bulgaria which are not at the moment applicant states. At the present time there is no prospect of water quality standards being applied to the whole of the Danube, but where we have control we can ensure that no pollution is being imposed by a state higher up the river on states lower down. That is what it is all about—and always has been.

Lord Pearson of Rannoch: Perhaps I may pursue a point raised by my noble friend Lady Park. Some time ago my noble friend and I sat on the same committee of this House which considered the progress of the water directives. Can the Minister give the Committee an assurance that other nations of Europe treat their water—I refer not only to beaches but rivers—with the same care and attention as we do? In Europe it is said that the only major city in the European Union which still discharges raw sewage into its local river, in this case the Meuse, is Brussels. Can the Minister give the Committee an assurance that other countries fulfil this glorious European policy when many of us believe that it can be done by intergovernmental collaboration; and that the Belgians are spending the same amount of money proportionately as the UK on these important matters?

Lord McIntosh of Haringey: Of course I cannot, and that is utterly irrelevant to the debate this evening. It is not part of the case to have multi-national responsibility to deal with the environment that we must be the best, or indeed the worst. It is some time since the Mersey caught fire because of the degree of pollution. I do not know about the rivers in Brussels, and it is not necessary that I should. What we must do is all act together.

Baroness Nicholson of Winterbourne: The noble Lord committed a very minor lapsus linguae. Romania and Bulgaria are applicant states. This gives me the opportunity to place on record the excellent treatment of the Danube undertaken by Romania, which in part is funded by the European Union.

Lord McIntosh of Haringey: The noble Baroness is quite right, but those nations are not in the next round. I did not in any sense criticise the way in which states on the Danube, or any state, dealt with environmental pollution. I make the point that many of these matters do not respect national boundaries, and the Danube is a very good example of that.

Lord Howell of Guildford: I am grateful to the noble Lord. In his earlier summing-up he made an impassioned case for a point which I thought that I had not only conceded but had heartily agreed with in my opening remarks; namely, that in the handling of the water resources of the great watercourses and rivers of Europe, trans-national co-operation of the most intimate kind is required. That can be done under EU auspices, with EU finance, or, as the noble Baroness, Lady Nicholson, reminded us, with EU assistance but actually outside the immediate purview of the Community and the treaty laws by which it is guided.
	The noble Baroness mentioned the Romanian management of the Danube. Another example is the way that Slovakia and Hungary have sorted out immense problems over the handling of Danube waters. These things can be done by immediate bilateral alliances or by going to supranational authorities, or the European Union where that is relevant.
	That makes my point. The management of water resources can obviously be handled on the big scale by large organisations spreading across sometimes many countries. In-between that and the ordinary every day hedging and ditching, which, if not done in a local community, may lead to most uncomfortable village flooding or the empty village pond for three years running, there is a vast area where it is highly questionable whether the grandeur of Community provisions and undertakings to make provisions, admittedly by unanimity—I concede that—for the quantitative management of water resources are of the slightest relevance.
	The Minister spoke about the Danube. I have spoken about the Rhine. What about the River Test—to take a rather well-known river in the middle of our country? It has many problems with flooding, water control, quantitative management, and so on. Do we really need to have this all-embracing proposal, whether by unanimity or by qualified majority voting, which it is not at the moment, at Community level—more remote, I use that adjective again—to put right our local and very intimate levels of miserable flooding last winter. There are signs of more miserable flooding this winter. The summer before there was serious drought and empty riverbeds. These require the most vigorous and detailed national programmes. I cannot honestly see where the Community comes into them. So there is a kind of failure of perception here that runs through many parts of the eagerness of the Community to take an active part in things.
	There are a whole range of problems, particularly environmental problems, that are better dealt with either at national level or at mixed national and Community level or even at regional and local authority level. One needs to be flexible. To create a pattern where the activism of the Community and its institutions sits like a teapot cover over the entire system introduces a rigidity where that is not needed. Indeed, on the contrary, enormous flexibility is needed.
	So some pollution is trans-national, some is national and some is local. We need to be ready to address these matters at all levels and to take great care before tying ourselves into one formula or another. At the most local level the best anti-pollution level is for everyone in our cities or anywhere else to sweep their front doorstep and to make sure that the immediate surroundings to their property are clean. I hope that we do not need a European directive or a Community provision to tell us to do that.

Lord McIntosh of Haringey: Can I say four words: "Of course we don't".

Lord Howell of Guildford: I am very glad for that reassurance. I am not so sure that it was so generous that it leads me to a total withdrawal of these amendments. I suspect that we shall want to return to aspects of this intrusiveness on Report. Nevertheless, the hour is late. In the light of that, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Howell of Guildford: moved Amendment No. 21:
	Page 1, line 9, after "10," insert "other than Article 2, paragraph 19, revising Article 191 of the Treaty establishing the European Community,"

Lord Howell of Guildford: We come now to a very sensitive issue on which we shall need a considerable amount of discussion. The amendment addresses European funding for political parties at the European level. The relevant article in the TEC is number 191, although other aspects are also affected. Other amendments in the grouping also refer to political parties in Declaration 11, which is important and to which I shall turn in a moment. Amendment No. 41 seeks to insert a new clause which I hope will prove to be completely non-controversial and thus will receive widespread support.
	To be frank, Article 191 is very controversial. It was controversial in its previous form, but with the additions it has become even more so. Previously it stated merely that political parties at the European level are,
	"important as a factor for integration within the Union".
	I am not sure that that is the case. It also asserted that they,
	"contribute to forming a European awareness and to expressing the political will of the citizens of the Union".
	I think that that is a snark-like hunt. There is no European collective identity and awareness in the political sense as it is understood in democratic politics. We are proud to be Europeans; that is fair enough. However, when referring to "awareness" people think in terms of smaller units. I do not believe that there is either a mechanism for achieving, or, indeed, a goal to be achieved, as regards a form of grand political will embracing all the citizens of the European Union. I refer to the present Union of some 350 million souls, let alone the larger one of 450 million people that lies ahead.
	The very concept of a political will being expressed by such an enormous number of people worries me as a democrat. It should worry all those who are anxious to maintain the thread of legitimacy stretching from the grass roots—the roots are in fact the masters; the citizens who cast their votes—right down to their servants: the officials and elected members of the governments and institutions of the European Union. That is the position even before I refer to the Nice treaty.
	I turn now to the new addition:
	"The Council, acting in accordance with the procedure referred to in Article 251"—
	which relates to qualified majority voting—
	"shall lay down the regulations governing political parties at European level and in particular the rules regarding their funding".
	We shall want to learn a great deal more about that procedure.
	The handling of funds for political parties is a matter to which politicians of this nation have given considerable attention, and properly so. We have achieved that by means of robust and democratic debate. I hope that over the years we have developed systems that are better, more transparent, more upright and more commanding of the trust and faith of the electorate. I dare say that we have further to go, but much has been done.
	Along comes the Council of Ministers, which out of the budget of the European Communities seeks to take funds which the Declaration, which is also on the Order Paper, states,
	"may not be used to fund either directly or indirectly political parties at national level".
	That will be extremely difficult to police. We shall need to learn an enormous amount as regards how that policing is to take place and how a distinction is to be made between European parties operating at European level and European parties operating within nation states—in which, after all, we live—and encouraging European awareness, as it is called, within the nation state. However, this is not so that they can say they are national parties promoting a national party cause. Frankly, I do not see how it is going to work. Presumably it can be made to work, but it will be extremely difficult. Perhaps the Minister can make me better informed. Is it 7 million euros or something like that? It is not much in the great rolling budgets of the Community—or, indeed, in our nation state budgets, which are enormous—but it is a lot of money in the hands of political parties and those who are out to express the will of the citizens of the Union.
	Let us get down to brass tacks. It will be said—not by the Minister because he is a generous and broad-minded man—that this is only because the Conservative Party in the United Kingdom is not one of the parties out to express the political will of the citizens of the Union. However, over the years, this party has done more than its fair share of expressing the political will of people throughout the whole of Europe who want to unite. One could go back to the Council of Europe, Lord Kilmuir and other antecedents to assert our credentials. But because this is not a transnational party with the same name popping up in different countries, we do not qualify. It may be said that that is our bad luck; that we should redesign our arrangements so that we do qualify. But in the meantime we do not.
	I have never been an enthusiast of state funding or, indeed—dare I say it—of large sums of money coming from particular sources. Political parties should be funded as far as possible by the modest savings of as many people as the political party can command the support of. That is the best source of funding. Party treasurers in my party will shoot me for saying that, but that is my feeling about where political funds should come from. I do not like great big blocks of money; I do not very much like state contributions, although they are perhaps inevitable in many countries; least of all do I like these matters being settled far away at the European level in accordance with some very vague criteria. It is all to do with political will—which I have asserted does not exist—and with the citizens of the Union, which we all are. That is perfectly true.
	I hope that we will hear a lot more about how this will work. We note the declaration that this funding will be kept away from political parties at national level, but we would like to see the matter much better aired. That is why we seek to insert a new clause after Clause 3 which requires that an annual report be laid before Parliament,
	"setting out the funds received by political parties at European level of which political parties represented in the United Kingdom are members, pursuant to Article 2, paragraph 19 of the Treaty of Nice".
	The amendment is needed to show that these funds are being allocated in a non-discriminatory way and are not being misused or leaking through into purposes for which they are not intended. We will want to know how the parties who receive them will be accountable for the funds concerned and that their arrangements and expenditures will be fully transparent, and we shall want to know a whole lot more besides.
	I am sure that the Government are as anxious as we are that the matter should be clean and above board in every possible way. I am sure that the other governments of Europe are too. Although we cannot amend the treaty, we can encourage our own Government to give an excellent example and a lead. I hope that is what they will do by at least accepting Amendment No. 41, the new clause, and recognising the validity of our arguments in regard to Amendments Nos. 21 and 36. I beg to move.

Lord Wallace of Saltaire: It is no secret that my party is in favour of additional state funding of political parties. Provided that there is a proper, transparent scheme for ensuring accountability, we believe it is a better means of supporting political parties than relying on eccentric millionaires. After all, the three largest donors to the Conservative Party at the last election accounted for precisely the same amount the noble Lord quoted as the European Union provides for funding of political parties at the European level.
	We therefore have a great deal of sympathy for Amendment No 41, because it provides for proper transparency. But we recognise that the purposes of these amendments to the treaty were to regularise a situation in which a certain amount of money was flowing to political parties represented in the European Parliament for their transnational activities and that it ought properly to be regularised in the treaties.
	There is a problem of democratic accountability at the European level. In our opinion, it helps to promote a more open, democratic debate if we encourage contacts among political parties across borders between like-minded parties in different countries. This is a contribution to that and, therefore, we are in favour of the principle of some support for European-level political parties. We are, however, extremely concerned about accountability; therefore, we support both the regularisation and the idea that there should be careful accounting and reporting from the British Government, as Amendment No. 41 suggests.

Lord Tomlinson: The provision in the Nice Treaty is not particularly new. It merely regularises a position that has been irregular in the past and has been severely criticised by the European Court of Auditors. The political groups of the European Parliament—all political groups—have been using some of the funds that they receive in a way that has been criticised by the Court of Auditors. None of those groups has emerged without criticism; none has emerged unscathed. This provision creates the very element of a specific budgetary line—with budgetary clarity, transparency and direct accountability—to regularise in the future that which has been irregular in the past.

Lord Biffen: The history of public funding of politics has been miserably unhappy. It has never been accepted with much enthusiasm, certainly not in this country—although one has to accept that it is very much a part of a method of operation. If one confines one's observations to one's domestic experience, there is no doubt that the so-called Short money is probably least subject to critical scrutiny.
	When we get beyond that—the point was made by the noble Lord, Lord Tomlinson—there begins to be a somewhat grey area. This was never more dramatically and, in personal terms, tragically demonstrated than in the case of Mr McLeish. So we should all proceed with due caution on these matters.
	My sense of caution is reinforced by the whole question of definition. The tradition in this country has never been one of confessional politics. So there has not been a natural partnership between the Christian Democrat parties and the Conservative Party. That is a matter of historical evolution. I do not attach too much significance to it, but it is none the less a pertinent point.
	But if we are now considering the matter in the context of European enlargement, and if we accept that Turkey stands just behind the applicant countries—I am grateful to the Minister for correcting himself and saying that Romania is an applicant country—we begin to raise much more serious points. A confessional party in Turkey will be a party inspired by Islamic teaching. This could relate to either the Fazilet Party or to the MHP. Both are significant parties. Both merit a role in the wider and more diverse Europe that we are postulating. Yet it is difficult to see the circumstances in which they could be merged into other European parties without fundamentally denying the tenets by which they stood. Nevertheless, in my view they are as much a part of a diverse Europe as the political parties that we have now established.
	I agree that in referring to Turkey I am talking outside the strict limits of applicants. But do we suppose that in this debate we are considering drawing a line with the present applicants, making it more difficult to move thereafter; or do we see that we have opened up a Europe which inevitably will move farther east and farther south? I think that it is the latter. It is a matter of judgment and maturity on our part at least to anticipate that whatever will be resolved for the present applicants will not make it more difficult for the next line of countries which would also like to join. That will be a judgment borne upon us increasingly in the context of what happened on 11th September.
	The other anxiety I have concerns not merely the doctrinal judgment as to which parties will be eligible for these funds; it concerns making the whole business watertight so that they do not spill over to the other political activities of the parties involved. That point has been mentioned. I refer to the institutions that exist within the Union. I do not make this point in a hostile sense but I refer to the political culture of France, the political culture of the Christian Democrats in Germany, the political culture in Italy and the political culture in many of those countries which do not make me think that they are much better at organising these matters than we are. I do not think that we have altogether a good record in that area. That is why I plead for a great deal of caution and a great deal of measured judgment in proceeding with these matters.

Lord Pearson of Rannoch: There are so many examples of my complaint as regards this new addition to the treaties that I do not know whether this is the right place to make it. However, this is a classic example of "Euro creep".
	The Minister may be aware that one of my favourite sports is stalking. By that I mean stalking deer, not the modern use of the word. The whole secret of stalking is to identify your quarry and to approach it extremely slowly. Whenever it looks at you, you stay absolutely still and pretend you are a rock. You pretend you are something very different. Eventually it puts down its head and goes on grazing and you creep forward again.
	The whole process of the treaties on European union resembles that activity. If Members of the Committee would care to invest in volume one of the excellent British Management Data Foundation's Treaty of Nice in Perspective, they will see on page after page how the original Treaty of Rome, through the Single European Act, through the Maastricht treaty, through the Treaty of Amsterdam to the Treaty of Nice is a constant process of Euro creep towards the ever closer union of the peoples of Europe and the European mega state which is the object of this particular exercise.
	Article 191—

Lord Tomlinson: I am grateful to the noble Lord for giving way. He complains about this matter being a manifestation of the ever closer union of the peoples of Europe. Is that not what the people of Britain voted for when they voted in a referendum?

Lord Pearson of Rannoch: No, they did not as a matter of fact. When the people of Britain voted in a referendum—I believe the noble Lord may refer to 1975—they voted to stay in what they were assured was a European common market. They were assured by the Prime Minister of the day that no sovereignty was at stake—

Lord Tomlinson: That was based on the Treaty of Rome.

Lord Pearson of Rannoch: That was, indeed, based on the Treaty of Rome. But I imagine the noble Lord will agree that not many people studied the detail of the Treaty of Rome at the time and those who did on the whole probably voted against it. However, there were very few of them. What the people of Britain voted for was a common market, a free trade arrangement, if you like. They certainly did not vote for what they actually got and they certainly did not vote for this kind of Euro creep, to which, if I may, I shall return.
	Article 191 was—I do not wish to embarrass my noble friends on the Front Bench—actually introduced in the Maastricht treaty. The first sentence of Article 191 is very important to my argument. It says:
	"Political parties at European level are important as a factor for integration within the Union".
	The next sentence reads:
	"They contribute to forming a European awareness and to expressing the political will of the citizens of the Union".
	When that came before us under the Maastricht treaty—which some of us opposed—I thought that it looked dangerous. It was another clear example of the stalker moving forwards a few paces on the ground and not being noticed. We felt that more was to come. We were assured that that was not the case and this was just the usual old Euro-guff and it did not mean anything; it was just an expression of warm European getting together and we could forget it.
	That is what we are always told when new advances are put into treaties. They are not supposed to look like advances; as I said earlier, they are supposed to look like a tussock of grass, a rock or something else very innocent.
	The Treaty of Amsterdam was good enough to give this issue a miss—there is no hurry in the process, after all—but now we get the Council acting in accordance with the procedure of Article 251, laying down the regulations governing political parties, and so on, to control and organise their funding.
	There is no doubt that the measure is another dangerous advance. That is why I support the amendment. I hope that the Minister will be able to assure us that my noble friend's fears are unfounded, but I am not sure that he will be able to convince me.

Baroness Nicholson of Winterbourne: As a Member of the European Parliament, I must say that the gravity with which we treat the Court of Auditors' reports is reflected in our desire to regularise an unhappy situation. It is extremely disconcerting to have such hefty and justifiable criticism from the Court of Auditors. We should congratulate the Court of Auditors and take every possible step to be in a position not to have to be criticised in that way again. This is not the first time. The court's criticisms have been firm and secure and, I believe, wholly justified. The provision is an excellent manoeuvre to enable us to come out of that unhappy situation.
	The noble Lord, Lord Howell, asked whether a particular volume of people can have a political identity or political will. We have a European cultural identity—we are Europeans. Of course the different regions, villages, towns and cities have different points of view on different things all the time. That is the diversity of the freedom of our political world. That is what we want; that is the challenge that we have to respond to.
	The last thing that any of us wants is for any volume of people to have a single view—a sort of blockbuster view. That would not be politics as we know it—the city, polis, the state—with different points of view coming forward. The people of Europe are represented and their views are reflected—all 350 million of them at this moment—by the Members of the European Parliament.
	We had a pathetic turnout in the elections for the European Parliament. Strengthening the capacity of the political parties to communicate better with the electorate on European Union matters can only be welcomed.

Lord Stoddart of Swindon: I have never been in favour of state financing of political parties and I do not believe in it now. The more state and central financing of political parties there is, the further away the electorate are pushed. That has been shown in election after election. I forget how much money was spent at the last election, but I think that it was getting on for £40 million altogether and we got a turnout of 59 per cent.
	People are giving all sorts of reasons for that. One is that it is too difficult to vote. I have never found it difficult to vote in my life. I have always found it easy and I have done so with alacrity. It is that alacrity that we must bring out in the electorate. The electorate will vote when they believe that they have something worth voting for. It is because they do not believe that at present that they are not voting and are staying at home. The electorate believe that their vote counts for nothing and that the House of Commons and, indeed, the European Parliament have no say and do not represent them as they believe they should be represented.
	There is one cure for that and it is not state financing. State financing will make the matter worse. It will lead to more corruption and people will say, "Well, they are only in it for themselves". Those of us who have been in local government, in the House of the Commons and in the European Parliament have all heard that argument. The more money that the state pushes out, the more that sentiment will be expressed.
	The approach must be completely different. It must involve the representatives meeting their constituents, explaining to them truthfully and in words they can understand what they are about, what they are involved in and what it means to them and to their country. All the money in the world is no substitute for that. The greater the centralisation and the more money that is spent centrally, the more contempt the electorate have for the process.
	My remedy is for the representatives to get back to their constituencies and to the members of the constituency parties. We should give them back the power that they have lost. We should ensure that local people keep in touch with party members and that they build up their parties. When I joined the Labour Party, it had 1 million members. Now it is lucky if it has 300,000. The Tory party had 3 million members. It is true that some were non-paying; nevertheless, it had 3 million members. At the moment, that number is down to 320,000. It is an absolute disgrace that we have reached that position; it undermines our very democracy. Money, in particular if it is paid by the state, will not cure it.
	Therefore, I hope that people who are involved in Europe and in the European Parliament will not go along that road but will go along the road of returning to their constituencies, explaining what it is all about and involving ordinary people in politics. That is the way forward to democracy, and it is the way forward to obtaining support from ordinary British voters.

Lord McIntosh of Haringey: I am slightly confused by the metaphors with which these arguments are advanced. I was perfectly happy with the noble Lord, Lord Howell, and his snark because I was perfectly happy to say that, as soon as he looked at his snark, he would find that it was a boojum, and that it would softly and suddenly vanish away and never be heard of again. I hope that I shall be able to convince him of that. However, not having the faintest idea what stalking is about and, having listened to the noble Lord, Lord Pearson, I do not know whether I am on the side of the deer or the stalker. I rather suspect that I am on the side of the deer.

Lord Pearson of Rannoch: The noble Lord is in fact the stalker and the British people are the hapless herd of deer.

Lord McIntosh of Haringey: Clearly the noble Lord changes sides when he goes north of the Border.
	This issue is much simpler than is apparent from this debate. We have had support for European political parties in the treaties since Maastricht. As the noble Baroness, Lady Nicholson, rightly said, the existing method of support for European political parties has been severely criticised by the Court of Auditors, mainly because, although the support is supposed to be for European political parties, of the suspicion—or more than that—that it has leaked to national parties. That seems to us to be a very bad thing. That is why we welcome Article 191, which, using QMV, states that there should be regulations governing political parties at European level—not, of course, national political parties—and in particular, the rules regarding their funding.
	Political parties at national level have been around since Walpole and, more significantly, since Eatanswill. European political parties are a relatively new and valuable development. It is hard to imagine how the European Parliament could operate without them; they are growing in importance, and so they should. It is right that there should be collective responsibility among those with like minds in the European Parliament. It is right that people should be able to form parties at European level as well as national level. That is, and historically has been, the view of the major national parties in most—I believe in all—European states, and certainly of those in this country.
	However, there is a problem. The political groups with the European Parliament receive money from the European Parliament budget for their day-to-day organisation, and the problem involves leakage to national political parties. That is why the regulation was recommended by the European Court of Auditors to combat financial mismanagement.
	That approach has the support of the Party of European Socialists and the Labour Party; the European Liberal, Democrat and Reform Party and the Liberal Democrat Party in this country; and the European People's Party and European Democrats, to which, until recently, the Conservative Party belonged and to which it is still allied. That is why member states are now finalising a suitable regulation that will stop financial abuse. It is doing so under Article 308 of the existing treaty. We support that; we want action as soon as possible to clean up funding.
	Nice provides a specific new treaty base and amended Article 191 of the EC Treaty with QMV to ensure that the provisions governing political parties are agreed or, as necessary, updated speedily without allowing one member state to block much-needed reforms. The measures will not finance national parties; that is clearly stated in Declaration 11.
	That does not involve "funds for federalism". I am not allowed to call the noble Lord, Lord Pearson, a Europhobe but he is certainly a Europaranoiac—he has been for many years. Everything comes towards federalism. There is no discrimination against parties on the grounds of their attitudes towards the European Union or integration. European political parties that oppose the EU or further integration will be just as eligible as those that think the opposite. That is also explicit in the Nice Treaty. It will not be possible for the proposed regulation to give the EU the power to ban political parties and it will not transfer any power to the Community. The declaration states that the provisions of Article 191 do not imply any transfer of powers to the European Community and do not affect the application of the relevant national constitutional rules.
	I do not know whether I want to say more about the Conservative Party. The noble Lord, Lord Howell, referred to the position with a suitable hesitancy. However, I should say that if the Conservative Party wishes to join a European political party, or to form a new one that meets the objective criteria that will be laid down in the regulations, it will be free to do so. I suggest that the objections raised in the debate on this amendment are seriously misconceived.

Lord Howell of Guildford: The Minister is persuasive, but not sufficiently to drive me from all of the amendments to which I spoke earlier.
	There was a mess before, and the Bill is an attempt to reduce the mess. But it nevertheless brings the issue into focus in a healthy way. Assertions were made at Nice—and at previous summits—about the essential need to reinvolve national legislatures and parliaments in the shaping of the future European Union—in the flow of decisions; the method of decision-making; and the modernisation of the old Community method. Some of that high rhetoric should be turned into practice.
	I make it absolutely clear that I am saying nothing against the value and essential role of the European Parliament and its distinguished Members—one of whom is here this evening—who do immensely valuable work in calling to account the European institutions. Sometimes—as with the worker consultation lower limit—collective decisions are reached that we do not like; sometimes sensible and insightful decisions are reached and proposals made.
	However—I think many at the European Parliament would agree with this—that is not by itself enough to fill the growing democratic deficit that lies at the heart of the European Union as we know it today. That deficit is growing. It was recognised in the European Commission's White Paper on governance, which acknowledged that feeling is growing about the entire legitimacy of the European Union. Its democratic procedures are being questioned. A government or great supranational body that cannot say that it commands full support for democratic procedures and show that it operates by them will lose legitimacy.
	So we certainly need a European Parliament—it does excellent work—but we need links brought back through national parliaments as well, and by more than words, by deeds also.
	We are talking about taxpayers' money. Taxpayers are citizens of the various member states of the Union. It is their money that is being spent and they are entitled to call to account those who are spending that money. That calling to account cannot be done only through the European Parliament, hard-working though it is; national legislatures must also play their part. That is becoming more, not less, true as time passes. It has now become a cliché, an obvious observation, that people are turning away from the political process and from politics and parliaments—national parliaments, let alone supranational bodies—for a number of interesting reasons.
	Let us conceive of the world as being organised so that markets work, but only within a political context, so the political context must be right. Let us consider that people have choices in the market, as consumers, where they have a fantastic range of instant satisfactions of their wants; but in politics they find the whole system to be more and more inaccessible and to offer fewer and fewer choices, although they feel more empowered and anxious to make such choices. We then begin to understand why people are turning away from politics—including, in this country at any rate, as has been said in this debate, from voting in European elections.

Lord McIntosh of Haringey: If the noble Lord will allow me to intervene, I was careful not to disagree with my noble friend Lord Stoddart, in particular when he deplored the decline of interest in politics. We all deplore that. It may be that to some extent it can be attributed to the decline in active membership of political parties, and that in turn can be attributed to all sorts of alternative forms of leisure activity.
	But it is a bit remote from this amendment to suggest that the existence of European political parties can be attributed to the decline in interest in politics or that it would be made better if there was less funding from the European Parliament of European political parties.

Lord Howell of Guildford: I am talking about the propositions before us; that is, the regulations governing the funding of European-level political parties. I am using this as an example of the sort of thing that, as we survey an increasingly worrying scene, with the loss of interest in political choices—people find that through the marketplace or non-elected bodies they can achieve their aims and obtain decisions faster than they can through politics—we should take more seriously. We should ensure that national legislatures—though they do not always command the respect a democrat would like—have a say in how these specific regulations are developed.

Lord McIntosh of Haringey: But surely that can be turned on its head as well. The fact that there are other ways in which we as individuals, as consumers, can achieve our desires in society other than through political parties is part of a wider democracy than purely political parties. That in turn is not a bad thing.

Lord Howell of Guildford: We are getting into very deep water here. I should like to see the political side of the choices of life made more accessible. The noble Lord may think I come from a party that is fanatically keen on markets. But I know perfectly well that markets do not work in a vacuum; they work in a good political framework. If the political framework becomes remote, discredited or unconnected with people voting at the grass roots, then we are all the losers—the market systems, the wealth-creating engines of our societies, the political system and the democratic stability and peace we all want.
	I see those issues as all of a piece, and it is important that they are brought back to national parliaments. We have a lot of other ideas for areas where we should return the decision-making of the European Union—or bring it closer—to national parliaments. They must be involved much earlier in the scrutiny of initiatives and to a much greater degree than they are now, otherwise this draining out of legitimacy will continue.

Lord McIntosh of Haringey: Again, there is no conflict between us on this. But there is a conflict in the amendment. Nothing in the provisions of the Treaty of Nice, as proposed here, in any way takes away from the role of national parliaments. Indeed, my noble friend Lady Symons made that very clear in her speech at Second Reading. She spoke of the problems which the Prime Minister identified at Warsaw—the problem of simplifying treaties to make them easier to understand; to improve accountability and transparency; and to involve national parliamentarians.
	I hope that the noble Lord, Lord Howell, agrees with that. I would have thought that was common ground between us.

Lord Howell of Guildford: I remain committed to all that will genuinely enhance the role of national parliamentarians and command the respect and trust of the electors that national parliamentarians are involved in the thread of democracy that must run up through the nation state to the European institutions, reinforced of course by the European Parliament. That is why I should like to see a more favourable response from the Government to the new clause we tabled. I know we cannot take this to a vote now and I would not want to. But after new Clause 3, Amendment No. 41 is a perfectly reasonable proposition that I hope all those who want to see our democratic institutions enhanced and refreshed will be ready to support.
	I have a feeling that I am not going to make much progress with that argument at this time of the night. It is something to which we would like to return later. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Grocott: I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.
	House resumed.
	House adjourned at nineteen minutes before eleven o'clock.